Late-delivery penalty calculator
A supplier ships 12 days late. The contract says "0.5% of the order value per day, capped at 10%". Instead of doing the arithmetic by hand, enter the contract amount, the two dates, the daily rate and the cap — the deduction and the final payment figure come out instantly, with a breakdown you can copy into the notice email.
Contract & dates
Deduction breakdown
Days late
2026-07-20 → 2026-08-01
Penalty by days
0.5% × 12 days of order value
Cap at contract %
Max 10% of order value
Deduction to apply
Below the cap — daily rate binds
Final payment due to supplier
$42,000
$45,000 retained − $3,000 penalty = $42,000
Sending the notice
Copy the "Deduction to apply" and "Final payment due" lines into a short email to the supplier: state the promised and actual delivery dates, the contract clause you're applying, and the amount withheld from the final payment. Keep the tone factual — the numbers do the talking.
Days are calendar days between the two dates. If your contract counts working days or excludes the day of delivery, adjust accordingly before relying on the figure. This tool is an aid, not legal advice — check the actual penalty clause in your contract.
Frequently asked questions
How is the late-delivery penalty calculated?
The penalty is the order value × days late × the daily rate, capped at the contract cap: penalty = min(order × lateDays × daily%, order × cap%). Days late is the calendar-day difference between the promised and actual delivery dates. With the default 0.5% per day, a 12-day delay on a $50,000 order gives 0.5% × 12 = 6% of the order value before the 10% cap.
What happens when the penalty hits the cap?
The tool takes the smaller of the by-days figure and the cap, so once 0.5% per day reaches 10% of the order value the deduction stops growing. The breakdown flags when the cap binds and shows what percentage of the cap is used — the final payment due is the retained balance minus the deduction.
Are the late days counted as calendar days or working days?
Days are calendar days counted between the two selected dates. If your contract counts working days or excludes the day of delivery, adjust the date inputs before relying on the figure. The tool is a planning aid, not legal advice — always check the actual penalty clause in your contract.
Check the actual penalty clause in your contract before relying on the figure — some count working days or exclude the day of delivery. This tool is an aid, not legal advice. ICBOMS does not provide legal or financial advice.