## Documentation Index

Access the complete documentation index at:
https://www.zoho.com/us/books/help/llms.txt

Use this file to discover all available documentation pages before proceeding.

# Late Fees

A late fee is an additional amount charged for an invoice that is paid after the due date. Implementing late fees in your business can help reduce overdue payments and encourage proper cash flow. You can either charge your customers based on a percentage of the invoice’s total amount or set a fixed amount. You can also exclude your loyal customers from being charged. Learn how to use this feature in Zoho Books.

## Enable Late Fees

To charge a late fee for your overdue invoices, you must enable it first. Here’s how:

*   Go to **Settings**, navigate to _Sales,_ and click **Invoices**.
*   Slide the toggle in the _Late Fees_ section to enable it for your organization.
*   In the _Late Fee Preferences_ pop-up, enter the following details:

Field

Description

**Apply Late Fee Based On**

Choose if you want to charge late fees based on:  
  
**Percentage** - A percentage of the invoice’s due amount will be calculated as late fees.  
  
**Fixed Amount** - A fixed amount will be collected irrespective of the invoice’s total amount.

**Invoice Overdue By**

Enter the number of days after the due date when a late fee should be charged.

**Percentage / Fixed Amount**

Enter the late fee percentage or the fixed amount you want to charge.

**Generate late fee invoices as drafts**

Check this box if you want the late fee invoices to be generated in the Draft status. You can review and send them or mark them as Sent.

**Default Account for Late Fees**

By default, the late fee amount will be tracked in the Late Fee Income account. You can edit the account if needed.

*   Click **Save** to apply the preferences to your late fee invoices.

### Send Late Fee Invoice

The late fee invoice will be generated and sent to the customers by default. You can also change the preferences to review the draft before sending it.

To send the late fee invoice manually:

*   Go to to _Sales_ and select **Invoices**.
*   Click the late fee invoice with the default prefix LF-xxxx.
*   Click **Send Mail**.
*   Click **Send** in the following email template page.

The late fee invoice will be sent to your customer.

### Late Fees Payment

Your customer can pay for the late fee amount in two ways:

[1\. Pay only the invoice amount](/us/books/help/invoice/late-fees.html#Pay-only-the-invoice-amount)  
[2\. Pay the late fee amount along with the invoice amount](/us/books/help/invoice/late-fees.html#Pay-the-late-fee-with-the-invoice-amount)

#### Pay Only the Invoice Amount

Once the payment option is enabled and the late fee invoice is sent, your customer can pay from the customer portal or the late fee invoice link that you’ve sent.

To do this, your customer should:

*   View the late fee invoice from the customer portal or the shared link.
*   Click **Pay Now** at the top-right corner of the page.
*   Enter the card details and click **Make Payment**.

The late fee invoice payment will be made successfully.

#### Pay the Late Fee with the Invoice Amount

If you’ve sent an invoice payment link that includes a late fee, your customer will need to pay both the invoice amount and the late fee together. If the customer has already paid the late fee, it won’t be included on the payment page and its details will be displayed in the invoice details page.

### Exclude Late Fee for Customers

You can exclude your loyal customers from paying late fees. Here’s how:

*   Navigate to _Sales_ and select **Customers**.
    
*   Select the particular customer to whom you don’t want to charge late fees.
    
    ![Exclude Late Fees](/books/help/images/invoice/exclude-late-fees.png)
*   In the _Other Details_ section of the _Overview_ tab, slide the **Late Fee** toggle.
    

Once it is disabled for this customer, they will no longer be charged late fees.  

### Other Actions

#### Edit Preferences

To edit the late fee preferences in your organization:

*   Go to **Settings**, navigate to _Sales,_ and click **Invoices**.
*   In the _Late Fees_ section, click **Configure Preferences**.
*   Make the required changes in the _Late Fees Preferences_ pop-up and click **Save**.

#### Disable Late Fees

To disable late fees:

*   Go to **Settings**, navigate to _Sales,_ and click **Invoices**.
*   Slide the toggle in the _Late Fees_ section to disable it.

The feature will be disabled.