Tiny ToolkitStatutory Interest Calculator
Calculate statutory interest on UK judgment debts at 8% per annum under the Judgments Act 1838
Statutory Interest: Under the Judgments Act 1838 Section 17, judgment debts carry interest at 8% per annum simple interest from the date of judgment until payment.
Standard Rates
Bank of England Base Rate Options
Important Notice
This calculator is provided for guidance only and does not constitute legal advice. Interest rates and calculation methods may vary depending on the specific circumstances, court orders, and applicable legislation. Always verify with the relevant statutory provisions and consider seeking professional legal advice for your specific case.
About Statutory Interest on Judgment Debts
Statutory interest on judgment debts is governed by Section 17 of the Judgments Act 1838, which sets the rate at 8% per annum simple interest. This rate applies to money judgments in the High Court (under s.35A Supreme Court Act 1981) and County Court (under s.69 County Courts Act 1984). Interest accrues daily from the date of judgment until the debt is paid in full.
How to Calculate Statutory Interest
Statutory interest is calculated using the simple interest formula:
Where:
- Principal = The judgment debt amount
- Rate = 8% per annum (0.08 as a decimal)
- Time = Number of days ÷ 365
Step-by-Step Calculation Example
Example: Calculating interest on a £10,000 judgment debt for 365 days (1 year):
- Calculate annual interest: £10,000 × 8% = £10,000 × 0.08 = £800
- Calculate daily interest: £800 ÷ 365 = £2.19 per day
- Calculate total for period: £2.19 × 365 days = £800
- Total amount due: £10,000 + £800 = £10,800
For 100 days: £2.19 × 100 = £219 interest, Total = £10,219
Key Statutory Provisions
Interest on judgment debts is recoverable under several statutory provisions:
- Judgments Act 1838 s.17 - Sets the 8% per annum rate
- Supreme Court Act 1981 s.35A - High Court judgments
- County Courts Act 1984 s.69 - County Court judgments
- Law Reform (Miscellaneous Provisions) Act 1934 s.3 - Other courts of record
- Bills of Exchange Act 1882 s.57(1)(b) - Dishonoured bills
- Late Payment of Commercial Debts (Interest) Act 1998 - Commercial debts (different rate)
When Does Interest Start and End?
Start Date
Statutory interest begins accruing from the date of judgment - the date when the court makes its order. This is typically the date of the judgment itself, not when the claim was filed or the hearing took place.
End Date
Interest continues to accrue daily until the judgment debt is paid in full or otherwise satisfied. Partial payments reduce the principal amount on which future interest is calculated.
Can the 8% Rate Be Changed?
Yes, courts have discretion to award interest at different rates:
- Court Discretion: Under s.35A and s.69, courts may award interest "at such rate as it thinks fit"
- Commercial Rates: Courts often award Bank of England base rate plus 1-2% in commercial cases
- Current Context: The 8% statutory rate remains commonly used, though commercial rates vary with the Bank of England base rate
- Factors Considered: Nature of claim, commercial borrowing rates, conduct of parties, and circumstances of the case
Using Historical Bank of England Base Rates
This calculator includes a unique feature to select historical Bank of England base rates, which is particularly useful when calculating interest for judgments from previous periods:
Why Use Historical Rates?
When courts award interest at "base rate plus 1%" or "base rate plus 2%", they typically mean the rate that was in effect during the relevant period. For older judgments or when calculating what rate applied at a specific time, you need the historical base rate.
How It Works
- Select from dropdown: Choose from current and historical Bank of England base rates (past 3 years available)
- Automatic calculation: When you select a historical rate, the "Base Rate + 1%" and "Base Rate + 2%" options automatically update
- Live data: Rates are fetched directly from the Bank of England's official database, ensuring accuracy
Recent Base Rate Changes
The Bank of England base rate has changed significantly in recent years:
- August 2025: 4.00% (current)
- May 2025: 4.25%
- February 2025: 4.50%
- November 2024: 4.75%
- August 2024: 5.00%
- August 2023: 5.25% (peak)
Example: If a court ordered interest at "base rate + 2%" for a judgment dated August 2023, you would select the 5.25% historical rate, resulting in a 7.25% interest rate for that period.
Simple vs Compound Interest
Statutory interest on judgment debts is calculated as simple interest, not compound interest:
Simple Interest
Interest is calculated only on the original principal amount. The formula remains constant throughout the period.
Year 1: £800
Year 2: £800
Total: £1,600
Compound Interest (Not Used)
Interest would be calculated on principal plus accumulated interest. This is NOT how judgment debt interest works.
Year 1: £800
Year 2: £864 (on £10,800)
Total: £1,664
Important Exceptions and Special Cases
- Small Claims: County Court judgments under £5,000 may not carry statutory interest
- Employment Tribunals: Different interest provisions apply to employment awards
- Tax Debts: HMRC debts under Taxes Management Act 1970 ss.86-92 have separate interest regimes
- Solicitors' Bills: Non-contentious work under Article 14 of the Solicitors (Non Contentious Business) Remuneration Order 1994 caps interest at judgment debt rate
- Arbitration: Section 49 Arbitration Act 1996 allows tribunals to award simple or compound interest
- Commercial Debts: Late Payment of Commercial Debts (Interest) Act 1998 provides different rates (base rate + 8%)
Important Disclaimer
This calculator is provided for guidance only and does not constitute legal or financial advice. Interest rates and calculation methods may vary depending on specific circumstances, court orders, and applicable legislation. The 8% statutory rate under the Judgments Act 1838 is the default, but courts have discretion to set different rates. Always verify calculations with the relevant statutory provisions and court orders. For complex cases or significant sums, consider seeking professional legal advice from a qualified solicitor or barrister.
Frequently Asked Questions
What is the statutory interest rate on UK judgment debts?
Under Section 17 of the Judgments Act 1838, judgment debts carry interest at 8% per annum simple interest. This rate applies from the date of judgment until the debt is satisfied (paid in full). The 8% rate is fixed by statute and applies to judgments in the High Court (under s.35A Supreme Court Act 1981) and County Court (under s.69 County Courts Act 1984).
How is statutory interest calculated on judgment debts?
Statutory interest is calculated using simple interest (not compound interest). The formula is: Interest = Principal × Rate × Time, where Time is measured in days divided by 365. For example, £10,000 at 8% for 365 days = £10,000 × 0.08 × 1 = £800. The interest accrues daily at (Principal × 8% ÷ 365) per day.
When does statutory interest start accruing on a judgment?
Statutory interest begins accruing from the date of judgment. The judgment date is typically when the court makes its order, not when the claim was filed or the hearing took place. Interest continues to accrue daily at 8% per annum until the judgment debt is paid in full or otherwise satisfied.
Can the 8% statutory interest rate be varied?
Yes, courts have discretion to set different rates. Under s.35A Supreme Court Act 1981 and s.69 County Courts Act 1984, courts may award interest at "such rate as it thinks fit". In commercial cases, courts often award rates based on the Bank of England base rate plus 1-2%. The court will consider factors like the nature of the claim, commercial borrowing rates, and the conduct of parties.
What is the difference between statutory interest and contractual interest?
Statutory interest (8% under Judgments Act 1838) applies after judgment is obtained. Contractual interest applies before judgment if there was an agreement between parties specifying an interest rate for late payment. The Late Payment of Commercial Debts (Interest) Act 1998 also provides statutory rates for unpaid commercial debts (currently Bank of England base rate + 8%). Claimants can claim pre-judgment interest under different provisions than post-judgment statutory interest.
Does statutory interest apply to all types of judgments?
Statutory interest at 8% applies to most money judgments in UK civil courts, including the High Court and County Court. However, some judgments may have different interest provisions: employment tribunal awards follow separate rules, small claims under £5,000 in County Court may not carry interest, and some statutory debts (like unpaid taxes under Taxes Management Act 1970) have their own interest regimes. Always check the specific legislation and court order.