How late-payment interest works

Domi Vera calculates late-payment interest for you. The part worth understanding is when it becomes final, because that is what decides whether you can still change it.

Provisional until you send

Interest on the current period is provisional. It is recalculated as things change — a payment arrives, a charge is corrected, a credit note is issued — and it stays fully editable while it is in that state.

Sending the statement is what makes it final. Once a tenant has been handed the figure, it is binding, so the system freezes it at that point and keeps it as a permanent record.

Send the statement and that period’s interest is locked. If the figure is wrong, fix it before you send — afterwards it can only be corrected by a further adjustment, which shows on the account as its own line.

This is why the Interest panel lets you adjust or waive an amount, and why that option quietly disappears for periods you have already sent.

What interest is charged on

Interest accrues on what is overdue and unpaid — the outstanding balance, not the invoice total. A tenant who pays half keeps accruing on the half that is left.

The settings that matter

Rate — the annual percentage.

Grace days — how long after the due date before interest starts. A grace of 0 means interest runs from the due date itself, so a payment must land on the due date to avoid it. A grace of 7 gives a week.

Compounding — whether interest itself earns interest, and how often.

In duplum — a South African common-law rule: accumulated interest may not exceed the outstanding capital. The system applies the cap for you.

The defaults are set once for the company and inherited by new leases, and any individual lease can override them. A lease negotiated on different terms keeps those terms without affecting anything else.

What a tenant sees

Interest appears on the statement as its own line, separate from rent and other charges, with the period it covers. Provisional interest is marked as such — so a tenant reading a statement mid-month can tell the difference between a figure that is still moving and one that has been finalised.

If you need to waive it

You can adjust an amount or waive it entirely while it is provisional. A waiver is recorded rather than deleted: the account shows that interest was raised and then waived, which is what you want when someone later asks why.