Late payment laws › Canada (Ontario)

Canada late payment: Ontario Construction Act prompt payment and the Interest Act

Not legal advice. Every statement below links to the official source it comes from.

Canada has no general federal late-payment law for private invoices; your contract governs. Construction is the big exception, with prompt-payment regimes in several provinces. Ontario's is the best-known example.

What the law says

• Under Ontario's Construction Act, an owner must pay a proper invoice within 28 days of receiving it, unless it gives a notice of non-payment.
  Source: Ontario: Construction Act, R.S.O. 1990, c. C.30
• A contractor that is paid must then pay its subcontractors within 7 days, with the same timing passing down the chain.
  Source: Ontario: Construction Act, R.S.O. 1990, c. C.30
• Federal Interest Act, section 4: if a contract states interest only as a rate for a period of less than a year (e.g. '2% per month') without also stating the equivalent yearly rate, interest above 5% per year is generally not recoverable. State late-payment interest as an annual rate too.
  Source: Justice Laws: Interest Act, R.S.C. 1985, c. I-15

Use it in your reminder

Mention the rule calmly and factually in your firm or final reminder, e.g. “Under [law], payment was due by [date]. Please pay by [deadline].” Work out the exact amount with the late payment interest calculator.

Related

• Small claims in Ontario and BC

Other jurisdictions

United Kingdom · European Union · Australia · New York State · New York City · California · Illinois · Los Angeles · Columbus, Ohio · Minneapolis · United States (general)

Not legal advice. This page summarises official sources as of 31 October 2026 for general information; laws change and details depend on your contract and circumstances. Check the linked source or ask a qualified lawyer before relying on it.