If there is a clause in the contract that delays the payment of interest, then the financial expenses should be offset.

Debit: bank deposit

Credit: Accounts receivable

Financial expenses-interest

The interest after loans overdue is calculated according to the penalty interest rate, and the penalty interest rate of each bank is different. Most banks stipulate that the penalty interest rate will rise by about 30%-50% on the basis of the previous loan interest rate.

"the Supreme People's Court's Reply on the Calculation Standard of Liquidated Damages" stipulates: "If the parties to a contract have not agreed on the calculation standard of liquidated damages, the people's court may calculate liquidated damages with reference to the standard of interest charged by the financial institution loans overdue stipulated by the People's Bank of China. When the People's Bank of China adjusts the loans overdue interest collection standard of financial institutions, the people's court may adjust the collection standard accordingly. At present, the standard for calculating liquidated damages can be calculated at four ten thousandths of a day.

Do I have to pay tax on the interest on overdue payment?

The VAT rate of loan interest income is 6%.

Notice of the Ministry of Finance of State Taxation Administration of The People's Republic of China City, People's Republic of China (PRC) on comprehensively promoting the pilot of changing business tax into value-added tax (Cai Shui [2016] No.36);

Article 15 VAT rate:

(1) Taxpayers engaged in taxable activities shall be taxed at a rate of 6%, except as provided in Items (2), (3) and (4) of this Article.

(2) Providing transportation, postal services, basic telecommunications, construction and real estate leasing services, selling real estate and transferring land use rights, with the tax rate of 1 1%.

(3) Providing tangible movable property leasing services at the tax rate of 17%.

(4) The cross-border taxable activities of domestic units and individuals are subject to zero tax rate. The specific scope shall be stipulated separately by the Ministry of Finance of People's Republic of China (PRC) and State Taxation Administration of The People's Republic of China.

How to deal with the accounting treatment of overdue payment interest? Generally speaking, the accounting information about the interest income generated by the overdue payment of goods by enterprises is here. Of course, if you have any other questions about this treatment after reading the above information, there are still many related materials on this website. You are welcome to come to this website to consult teachers or watch related video teaching directly.