Late Fees on Invoices in Arkansas
What Arkansas contractors and small businesses need to know about charging late fees, interest rates, prompt payment laws, and mechanics lien deadlines.
Max Interest Rate
5% above the Federal Reserve discount rate; 17% maximum
Small Claims Limit
$5,000
Small Claims Division (District Court)
Mechanics Lien Deadline
120 days from the last day of furnishing labor or materials
Arkansas Prompt Payment Act
Arkansas Prompt Payment Act, Ark. Code Ann. § 22-9-801 et seq.
Arkansas requires state agencies to pay within 30 days of a proper invoice. Private construction follows contract terms, with lien rights under Ark. Code Ann. § 18-44.
Late fee rules for Arkansas invoices
Arkansas enforces contractual late fees up to the usury limit. The constitutional cap means late fee clauses must stay under 17% per annum.
Arkansas has a constitutional usury limit. The maximum contract interest rate is 5% above the Federal Reserve discount rate, not to exceed 17% per annum.
Important disclaimer
This page provides general information about Arkansas late fee rules. It is not legal advice. Laws change, and your specific situation may have unique factors. For disputes involving significant amounts, consult a licensed attorney in Arkansas.
Demand letters and mechanics liens in Arkansas
Arkansas does not require a demand letter before filing a mechanics lien, but one is recommended to demonstrate good faith efforts at collection.
Mechanics lien deadline: 120 days from the last day of furnishing labor or materials. A lien must be filed in the circuit clerk's office.
Sample late fee clause for Arkansas invoices
“Payment is due within the terms specified above. A late fee of 1.5% per month (5% above the Federal Reserve discount rate; 17% maximum maximum per Arkansas law) will be applied to all balances remaining unpaid after the due date. Pursuant to Arkansas Code Ann. § 18-44-101 et seq. (Materialmen's and Mechanics' Liens), the undersigned reserves all rights to pursue collection including but not limited to mechanics lien filing, small claims action (up to $5,000 in Small Claims Division (District Court)), and referral to collections.”
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Start Free TrialFrequently asked questions — Arkansas
What is the maximum late fee I can charge on an invoice in Arkansas?▾
In Arkansas, Arkansas has a constitutional usury limit. The maximum contract interest rate is 5% above the Federal Reserve discount rate, not to exceed 17% per annum. Always disclose late fee terms in your contract or invoice before work begins.
Does Arkansas have a prompt payment act?▾
Yes. Arkansas requires state agencies to pay within 30 days of a proper invoice. Private construction follows contract terms, with lien rights under Ark. Code Ann. § 18-44.
What is the small claims court limit in Arkansas?▾
The small claims court limit in Arkansas is $5,000. Claims are filed in Small Claims Division (District Court). You generally do not need an attorney for small claims.
How long do I have to file a mechanics lien in Arkansas?▾
In Arkansas, 120 days from the last day of furnishing labor or materials. A lien must be filed in the circuit clerk's office.
Do I need to send a demand letter before filing a lien in Arkansas?▾
Arkansas does not require a demand letter before filing a mechanics lien, but one is recommended to demonstrate good faith efforts at collection.