if the lease states - interest is calculated daily from the due date, continues until the overdue money is paid and is capitalised monthly to calculate this do i take the monthly rent and times by the interest rate stated in the lease (to give a daily rate) and then times by how many days a payment is late??

... x 12 / 365 to get the daily rate? Then for every month it is late, the amount needs to be capitalised into the total amount owing for the puposes of calculation.... Cheers, The Y-man

Hi, Is it an annual interest rate or something else? e.g. if the penalty interest was 8% per annum, then the daily rate would be; annual rate / 365 Then I assume interest is calculated on the amount owing, in this case the missing lease payment if the monthly rent was $2000, then penalty interest might be calculated as; $2000 x daily interest rate If you fail to pay the lease payment for 1 month, then on the day of the next monthly period, the amount on which penalty interest is calculated on is incremented to equal; $2000 + sum total of all the daily interest charges for the past month. This new total is what interest would be calculated on. In essence, the daily interest charges are applied (compounded) each month onto the outstanding balance. And if you're late two months, then it would be lease + interest + lease + interest Regards Michael

Sorry to question again, i think that i have gone through the calculations too many times and confused myself. currently penalty interest rate is 13% per annum. Current monthly rent is $1083.33 plus gst do i take the 13% and divide by 365 to get the daily rate = 0.03561 if i then take the monthly rent $1083.33 X 0.03561 = $38.58 (rounded) and this the daily penalty interest charge for every day the tenant is late in paying?