> For the complete documentation index, see [llms.txt](https://docs.loopit.co/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.loopit.co/billing/invoices/overdue-invoices/applying-automatic-late-payment-fees.md).

# Applying Automatic Late Payment Fees

To help manage overdue invoices, Loopit allows you to automatically apply a **Late Payment Fee** after a set number of days past the due date. You can also customise how and when this fee is applied across your customer base.

## How to Enable Automatic Late Payment Fees

To set up late payment fees:

1. Go to **Settings** in the navigation menu.
2. Under the **Billing** section, click on **Late Payment Fee**.
3. Toggle **Enable Late Payment Fee** to turn it on.
4. Select an existing billing item to use as the late fee, or [create a new billing item ](https://docs.loopit.co/billing/billing-items#how-to-create-a-new-item)if needed.
5. **Type in the fee amount** you want to apply.

   > 💡 **Note:** This amount should be **exclusive of Tax/GST**.
6. Set the number of days after an invoice becomes overdue for the fee to be applied.
7. Choose one or more of the following options:
   * **Apply late payment fee to past due invoices**\
     This will apply the fee to invoices that are already overdue.
   * **Apply status to all companies and people**\
     This will enable late fees across all current and future accounts and their bookings.
   * **Apply late fee to next recurring invoice for active bookings**

     When this setting is enabled and a booking is active with an overdue invoice, the system will automatically include the late payment fee on the next recurring invoice, will not re-apply it if manually removed by a user from pending invoice, and still permits manual application from the Overdue Invoices list.

## Exclude Bookings from Late Payment Fees

If you need to **exclude specific bookings** from having a late payment fee applied:

1. Navigate to the booking in question.
2. Click on the **Billing** tab.
3. Go to **Settings** within the billing section.
4. Disable the option for applying late payment fees for that individual booking.

{% hint style="info" %}
**Tip:** Late payment fees are useful for encouraging timely payments but should be communicated clearly in your customer terms and conditions.
{% endhint %}

If you need help setting this up or managing billing settings, feel free to contact our support team via <support@loopit.co>.