Previously in terms of the South African Medical & Dental Council's Guidelines, practitioners could only charge interest from 90 days after the date on which the service had been rendered.

The Council scrapped the time limit on charging of interest. It meant that practitioners are no longer restricted in terms of the period after which interest may be charged or regarding the interest percentage, provided they inform a patient beforehand that they charge interest on overdue accounts.

In terms of South African common law interest runs on a principal debt if the person liable fails to pay. The liability for interest arises when the debtor has knowledge of the liability and the extent of the liability.

Practitioners should be aware of the following before charging interest on overdue accounts:-

1. Interest maybe claimed only if there is an agreement to pay interest, or where the patient is in arrears.
2. It is recommended that a note to this effect is printed on all accounts;
3. Where the agreement provides for interest but is silent as to the rate of interest that the dentist will charge or no agreement is reached with the patient, the rate that is provided for in the Prescribed Rate of Interest Act, 1975 would apply, which at present is 15.5% pa.
4. The dentist may, within reason, decide after which period he/she will charge interest, although interest may be charged from day one. It is recommended that patients be given at least 30 days or 60 days to settle accounts before interest is charged.
5. The rate of interest stipulated must be reasonable and may not exceed the rate determined by the Minister of Justice currently as follows:-
   5.1. up to R6000,00 – the rate is limited to a maximum of 32% pa;
   5.2. between R6000,00 and R500 000,00 - interest is limited to a maximum of 29% pa;
6. It is fair to link the interest rate to the rate the practice itself is charged by the bank for

** "The practitioner (name) shall be entitled to charge the Patient interest at the rate of 3% per month above the prime bank lending rate of (name of Bank) subject to the maximum legal lending rate on all accounts outstanding from due date provided, however, that nothing herein contained shall be interpreted as obliging the Practitioner to afford the Patient any such indulgence to effect payment after due date."