FOS interest calculator
The interest on money you are owed, at the rate the Financial Ombudsman or a court would apply. Amount, dates, rate.
Interest rate
Three steps
- 1.Choose your interest rate
- 2.Enter the amount owed
- 3.Set the date range
Estimates only. Check the figure against the Ombudsman’s own guidance before relying on it.
How to use it
- 1Enter the amount owed: the refund or compensation you are asking for.
- 2Set the start date: when you paid, or were first without the money.
- 3Set the end date: today, or the date you expect to be paid.
- 4Choose the rate that applies to your route.
How the interest is worked out
The Financial Ombudsman uses simple interest, not compound: interest on the original amount only, never on interest already added.
For complaints referred before 1 January 2026 the rate is a flat 8% a year. From January 2026 it is the Bank of England base rate plus 1%, averaged across the period if the base rate changes while your complaint is open.
Which rate applies
- Ombudsman, referred before January 2026
- 8% simple interest a year.
- Ombudsman, referred from January 2026
- Bank of England base rate plus 1%, averaged over the period if the rate changed.
- County court
- 8% statutory interest.
- A late-paid Ombudsman award
- 8%, whenever the complaint was referred.
The current base rate is published on the Bank of England website.
Tax on the interest
The interest is paid gross, without tax taken off, and counts towards your personal savings allowance: £1,000 at the basic rate, £500 at the higher rate, nothing at the additional rate.
If your savings interest for the year, this included, goes over the allowance, it is declared to HMRC. The compensation itself is usually not taxable. Only the interest is.
Common questions
The 8% interest rate is the standard rate used by the Financial Ombudsman Service (FOS) for compensation awards on complaints referred before 1 January 2026. It's also the statutory interest rate for County Court judgments. This rate compensates you for being without your money during the dispute period.
Interest on car finance refunds is calculated as simple interest from the date you were deprived of the money until the date of payment. For FOS complaints before 2026, use 8% per year. For complaints from 2026 onwards, use the Bank of England base rate plus 1%. Multiply the refund amount by the rate and the number of days, divided by 365.
Interest on compensation is paid gross (without tax deducted) but may be taxable depending on your circumstances. It counts towards your Personal Savings Allowance (£1,000 for basic rate taxpayers, £500 for higher rate). If you exceed your allowance, you may need to declare it to HMRC via self-assessment.
From 1 January 2026, the Financial Ombudsman Service uses the Bank of England base rate plus 1 percentage point for calculating interest on compensation. If the BoE rate changes during your claim period, a time-weighted average is calculated. This replaced the previous flat 8% rate for new complaints.
Yes, if you're entitled to a refund under the Consumer Rights Act 2015, you can also claim interest from the date you paid for the vehicle (or rejected it) until the refund is paid. The rate depends on whether you go through the FOS or courts, but 8% is typical for both.
No. Interest is only calculated on the contractual or financial elements of your compensation—such as refunds, overcharges, or money you were deprived of. Payments for distress, inconvenience, or emotional impact are separate awards and do not attract interest. Only include the principal financial amounts when calculating interest owed.
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