Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Interest definition

What does Interest mean? Interest is the additional sum payable for the time‑value of money: the amount a borrower pays a lender for using money, the return on debt‑type investments, and the sum awarded for being kept out of funds in litigation. Entitlement arises by: - Contract (contractual interest), including default interest, fixed or floating rates (for example, over base rate or SONIA), and simple or compound interest. Clauses must be clearly drafted and not operate as an unlawful penalty or unfair term. - Statute (statutory interest), for example late payment interest on commercial debts under the Late Payment of Commercial Debts (Interest) Act...

Interest on judgment debts: rate, commencement, stays pending appeal, County Court scope, Tomlin orders, and contractual post-judgment interest after merger (England and Wales)

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Practice notes

This Practice Note sets out guidance on recovering interest on judgment debts. For details on interest at the point of issue:

a claim—see Practice Note: Claiming interest
a foreign currency claim—see Practice Note: Foreign currency claims—interest on damages claims and judgment debts

When and at what rate do judgment debts attract interest?

By virtue of section 17 of the Judgments Act 1838 (JA 1838) and the Judgment Debts (Rate of Interest) Order 1993, SI 1993/564, judgment sums accrue simple interest at 8% per annum until paid, unless court rules provide otherwise. This rate has applied since 1 April 1993. The court has no power to alter the statutory rate under JA 1838 (School Facility Management v Governing Body of Christ the King College (applying Rocco Giuseppe v Tradax Export and Chubb v Dean) and Schlumberger Holdings v Electromagnetic Geoservices), though it may fix the date from which interest begins to run (CPR 40.8). A different approach applies to foreign currency matters—see Practice Note: Foreign currency claims—interest on damages claims and judgment debts. Unless a rule, Practice Direction or the court specifies a different date, interest runs from the date judgment is given (CPR 40.8(1))...

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Web page updated on 21/05/2026

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