Owed money on a certificate? Here is what it has earned, and what to send.
Every subcontractor in the country has waited on a certificate. This page does the arithmetic and the paperwork: the interest the debt is earning at the prescribed rate, the dates that end a claim if you let them pass, the order to escalate in with the Act behind each step, and the three letters, filled in from your numbers. Nothing you type leaves your browser.
What you are owed
Simple interest, per day, from each due date to today.
Capital
R845 000
Interest to today
R7 789
What to claim today
R852 789
and R243 more for every day it stays unpaid
The dates that kill a claim
21 Sept 2029
1051 days left
The debt prescribes, unless the clock is interrupted
Three years from the day it fell due. Service of a summons or an arbitration notice interrupts it; so does an acknowledgement by the debtor, which starts the three years again. A letter of demand does not. Prescription Act 68 of 1969, s 11(d), s 14 and s 15.
Days, not years
your contract
The contract’s own notice periods
Notices of dispute, of suspension and of claims usually run in days, and a claim that misses one can be lost long before prescription is near. Put each one in the diary the day the payment date is missed. What a time-bar is: the glossary.
The order to escalate in
The due date
The debt falls due
Where the contract fixes the payment date, the debtor is in mora from that date without any demand, and interest runs from it. Organs of state have a default: national and provincial departments must settle within 30 days of receiving an invoice unless the contract says otherwise, and a municipality's accounting officer must take all reasonable steps to pay within 30 days of receiving the invoice or statement.
Common law (mora ex re); PFMA Treasury Regulations, reg 8.2.3; MFMA 56 of 2003, s 65(2)(e)
Day 1 late
A reminder that reserves your rights
Short and polite, but in writing, and with one sentence that reserves every right under the contract and at law. Accepting late payment again and again without saying so can stop you enforcing the date later.
Common law (estoppel)
Day 7 to 14 late
The letter of demand
Set out the claim so the debtor can work out the amount: each certificate or invoice, its date, what is owed, the interest rate and the date from which it runs. That is the Act's own definition of a demand. On an unliquidated debt, interest runs from the day the demand is served.
Prescribed Rate of Interest Act 55 of 1975, s 2A(2)(a) and s 4
With the demand
Ask them to acknowledge the debt
A letter of demand does not stop prescription. An acknowledgement by the debtor does, and it restarts the three-year clock from the beginning. A signed confirmation of the amount, or even an email that says the money is owed, is worth more than the demand. Keep every one.
Prescription Act 68 of 1969, s 14
As your contract allows
The contract's own remedies
Most standard forms give a remedy for non-payment: suspension of the works, cancellation after notice, and adjudication or arbitration of the dispute. Each has its own notice and its own days. Use exactly the route your contract sets out. Stopping work without the contract's right to is how the unpaid party becomes the one in breach.
The contract: JBCC, GCC 2015, NEC and FIDIC each carry these; read your edition's payment and dispute clauses
Before 3 years
Summons, or another process that interrupts
A contractual debt is ordinarily extinguished three years after it becomes due. Only service of a process claiming payment (a summons, or a notice starting arbitration) or an acknowledgement stops that. Chasing politely for three years ends the claim.
Prescription Act 68 of 1969, s 11(d), s 12 and s 15
Owed by a department or a municipality? Switch to an organ of state: there is an extra six-month notice.
The letters
Sets out the claim as the Act defines a demand, with interest.
[Your company] 05 Nov 2026 To: [Debtor company] Attention: [Name, position] Re: [Project name and contract reference] LETTER OF DEMAND 1. [Your company] carried out work for [Debtor company] on the project above. The following amounts fell due for payment and remain unpaid: - Payment certificate 4: R480 000, due 21 Sept 2026, 45 days late, interest at 10,50% a year - Payment certificate 5: R365 000, due 21 Oct 2026, 15 days late, interest at 10,50% a year 2. The capital outstanding is R845 000. 3. Interest runs on each amount from its due date at the rate shown against it (the prescribed rate in force on its due date, Prescribed Rate of Interest Act 55 of 1975, s 1). At today's date the interest is R7 789, and it continues to run until payment. 4. We demand payment of R852 789, together with further interest to the date of payment, by 12 Nov 2026, into the account on our invoice. 5. If payment is not received by that date, we will proceed without further notice with the remedies available to us under the contract and at law, which may include [suspension of the works / adjudication / arbitration / legal proceedings: state only what your contract allows], and we will claim the costs of doing so. 6. [Your company] reserves all of its rights under the contract and at law, including the right to interest on the amounts outstanding. Nothing in this letter, and no acceptance of any late or partial payment, waives any of them. Yours faithfully [Name] [Position], for and on behalf of [Your company]
These are working drafts, not legal advice. Before suspending the works, cancelling, or issuing a summons, have an attorney read the contract and the letter.
Which interest rate applies
If your contract sets a rate, that rate governs. The prescribed rate only applies where no law, agreement or trade custom sets one (s 1(1)). Check the payment clause before you use the default.
The prescribed rate is the repo rate plus 3,5% a year (s 1(2)(a)). The Minister publishes each new rate in the Gazette, and it takes effect on the first day of the second month after the month the Reserve Bank moved the repo (s 1(2)(b) and (c)).
- 10,25% from 01 Mar 2026 (Notice 3887 in GG 54520 of 17 April 2026)
- 10,50% from 01 Jul 2026 (repo plus 3,5% from 1 July 2026)
- 10,75% from 01 Nov 2026 (repo 7,25% plus 3,5%)
The rate is fixed when interest starts running, not re-set each time the repo moves (s 1(1)). The calculator gives each line the rate in force on its due date, from the list above. For a debt that fell due before March 2026, open the notice for that date and type its rate in.
Arrear interest stops at the capital. Under the common-law in duplum rule, unpaid interest stops running once it equals the capital outstanding. The calculator caps each line there.
Every repo decision and the other rates behind a price are on the prices lane; what retention costs to carry while you wait is there too.
Hiring?
On the panel, the payment terms are settled before a spade goes in: one quote from one company, 85% on award, 15% on completion. The best letter of demand is the one a contract never needs.