Everything freelancers and small businesses need to know about charging late fees, interest rates, and collecting overdue invoices in Florida.
This information is provided for general educational purposes only and does not constitute legal advice. Laws change frequently. Consult a licensed attorney in Florida for advice on your specific situation. Last reviewed: 2026.
Usury laws cap the maximum interest rate that can be charged on overdue payments in Florida.
18% per annum (simple interest); 25% criminal usury threshold
Florida sets the maximum lawful interest rate at 18% per annum for simple interest (Fla. Stat. § 687.02). Charging above 25% per annum constitutes criminal usury, a felony. The default legal rate when no rate is specified is 12% per annum. Florida's tiered structure distinguishes between civil and criminal usury violations.
Business loans of $500,000 or more are exempt from the 18% cap (Fla. Stat. § 687.02(1)). Banks, savings associations, and licensed lenders have additional exemptions. International transactions may also be exempt.
Understanding what you can and cannot charge for late payments in Florida.
Florida allows late fees on commercial invoices when agreed upon in the contract. Late fees must be reasonable and not exceed the 18% usury cap when characterized as interest. Florida courts evaluate late fees under the liquidated damages framework, requiring they bear a reasonable relationship to anticipated damages.
No specific statutory cap; must stay within the 18% usury limit when structured as interest.
Florida courts use a two-part test: (1) the damages from breach must be difficult to estimate at the time of contracting, and (2) the amount fixed must be a reasonable estimate of such damages. Fees failing this test are unenforceable penalties.
Florida Prompt Payment Act sets deadlines and penalties for late payments in Florida.
25 days for local government; 40 days for state agencies (Fla. Stat. §§ 218.70-80). Construction: 25 days after approval of contractor's pay request.
Interest at 1% per month (12% per annum) on late payments, plus attorney's fees in some cases.
Florida has one of the most comprehensive prompt payment laws in the nation. The Local Government Prompt Payment Act (Fla. Stat. §§ 218.70-80) requires local entities to pay within 25 days and state agencies within 40 days. Construction has specific provisions including 25-day payment after approval, dispute resolution procedures, and mandatory interest on retainage.
Certain industries in Florida have additional rules around payment timelines, liens, and collection procedures.
Construction: Florida's Construction Lien Law (Fla. Stat. Ch. 713) requires a Notice to Owner within 45 days of first furnishing labor/materials. Claims of lien must be recorded within 90 days of last furnishing. Florida's construction payment protections are among the strongest in the nation.
Government contracts: Florida's Prompt Payment Act (Fla. Stat. §§ 218.70-80) provides detailed procedures for payment disputes, including mandatory interest on retainage and an expedited dispute resolution process.
Insurance: Florida requires insurers to pay claims within 90 days of filing (Fla. Stat. § 627.70131). Late payments may trigger bad faith penalties and attorney's fees.
Use this compliant wording on your invoices to clearly communicate your late fee policy in accordance with Florida law.
Payment is due within 30 days of invoice date. A late fee of 1.5% per month (18% per annum, the maximum rate under Florida law, Fla. Stat. § 687.02) will be applied to all invoices remaining unpaid after the due date. This fee constitutes agreed-upon liquidated damages for the cost of managing overdue accounts.
This wording works because it clearly states the rate, when it applies, and references Florida legal standards. Always ensure your stated rate complies with Florida's usury limits.
Practical tips for invoicing within Florida's legal framework.
Before you can charge a late fee in Florida, your client needs to have agreed to the terms. Include your late fee clause directly on your invoice and in your contract.
Florida caps interest rates at 18% simple / 25% criminal usury. Charging above this limit can void your right to collect interest entirely and may expose you to penalties.
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Compare Florida's rules with neighboring and commonly referenced states.
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