Everything freelancers and small businesses need to know about charging late fees, interest rates, and collecting overdue invoices in Utah.
This information is provided for general educational purposes only and does not constitute legal advice. Laws change frequently. Consult a licensed attorney in Utah for advice on your specific situation. Last reviewed: 2026.
Usury laws cap the maximum interest rate that can be charged on overdue payments in Utah.
10% default; no general cap for written agreements
Utah's default interest rate is 10% (Utah Code § 15-1-1). Utah does not impose a general usury cap on written agreements between parties.
All commercial transactions with written agreements are effectively exempt from usury limits.
Understanding what you can and cannot charge for late payments in Utah.
Late fees are permitted when agreed upon in writing. Without agreement, the default rate applies.
No statutory cap for contractual late fees.
General contract principles apply. Fees must not be unconscionable.
Utah Prompt Payment Act sets deadlines and penalties for late payments in Utah.
60 days for state contracts.
Interest at 2% above the prime rate.
Utah Code § 15-6-3 requires government entities to pay within 60 days or pay interest at 2% above prime.
Certain industries in Utah have additional rules around payment timelines, liens, and collection procedures.
Construction: Utah Code § 13-8-5 prohibits pay-if-paid clauses and requires payment within 30 days of approval.
Government contracts: 60-day payment required under Utah Code § 15-6-3.
Technology: Utah's tech corridor (Silicon Slopes) typically follows standard Net 30 commercial terms.
Use this compliant wording on your invoices to clearly communicate your late fee policy in accordance with Utah law.
Payment is due within 30 days. A late fee of 1.5% per month (18% per annum) will be assessed on unpaid invoices, as permitted under Utah law (Utah Code § 15-1-1).
This wording works because it clearly states the rate, when it applies, and references Utah legal standards. Always ensure your stated rate complies with Utah's usury limits.
Practical tips for invoicing within Utah's legal framework.
Before you can charge a late fee in Utah, your client needs to have agreed to the terms. Include your late fee clause directly on your invoice and in your contract.
Utah caps interest rates at 10% default / No general cap. Charging above this limit can void your right to collect interest entirely and may expose you to penalties.
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Compare Utah's rules with neighboring and commonly referenced states.
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