Ontario's Courts of Justice Act provides for two kinds of interest on a Small Claims Court judgment: prejudgment interest, which accrues from the date the cause of action arose until judgment, and postjudgment interest, which accrues on the unpaid judgment amount from the date of judgment until it is paid in full. Both are calculated separately from — and added on top of — the $50,000 monetary limit, using rates set quarterly by the province.
- Interest is calculated separately from the $50,000 monetary limit and is added on top of your award.
- Prejudgment interest generally runs from when your cause of action arose until the date of judgment.
- Postjudgment interest runs on the unpaid balance from the date of judgment until the debt is actually paid.
- Interest rates for both are set quarterly under the Courts of Justice Act and can change over the life of a case.
- A written contract specifying its own interest rate can sometimes override the default statutory rate.
- Interest continues to accrue even after judgment, which can meaningfully increase what a debtor ultimately owes if they delay payment.
The Short Answer
Ontario's Courts of Justice Act allows for two distinct kinds of interest on a Small Claims Court judgment: prejudgment interest, covering the period before judgment, and postjudgment interest, covering the period after. Both are calculated separately from the $50,000 monetary limit and are added on top of whatever principal amount you are awarded.
Prejudgment Interest
Prejudgment interest generally runs from the date your cause of action arose — for example, when a debt became due or an incident causing loss occurred — until the date judgment is issued. This compensates you for the time value of money you were owed but had not yet received, and it is calculated at the rate in effect during the relevant period.
Postjudgment Interest
Once judgment is issued, postjudgment interest begins accruing on the unpaid balance, continuing until the debtor actually pays in full. This matters enormously in practice: a debtor who delays payment does not simply owe the original judgment amount indefinitely — the amount owed keeps growing. Our post-judgment interest calculator can help you estimate how much is currently owed on an unpaid judgment.
Because postjudgment interest continues to accrue, a debtor who stalls on payment is not avoiding the debt — they are simply making it larger, which can be a useful point to raise during collection or settlement discussions.
How the Interest Rate Is Set
Both prejudgment and postjudgment interest rates under the Courts of Justice Act are set quarterly by the province, based on a formula tied to treasury bill rates. This means the applicable rate can differ depending on when your cause of action arose or when judgment was issued — it is not a single fixed number over time.
When Your Contract Specifies Its Own Rate
If you are suing under a written contract that specifies its own interest rate for late or unpaid amounts, that contractual rate can often apply instead of the statutory default — provided it is clearly documented and not otherwise unenforceable (for example, exceeding limits under the Criminal Code's interest rate provisions). This is worth reviewing carefully with a lawyer before filing your claim.
Why This Matters for Collection
Understanding both types of interest matters at two stages: when you draft your Statement of Claim (to make sure you properly claim interest from the correct starting date), and when you are collecting on a judgment (to make sure you are demanding the correct, current amount owed, not just the original judgment figure).
Calculating Interest for Your Claim
Getting the interest calculation right — both when filing and when collecting — can add real value to your claim. Call 416-274-2222 for a free consultation if you need help calculating or claiming interest correctly.
Frequently Asked Questions
No. The monetary limit applies to the principal amount claimed. Interest and costs are calculated and awarded separately, on top of that limit.
Generally from the date your cause of action arose — for example, the date a debt became due, or the date of an incident causing damages — until the date of judgment.
Yes. Postjudgment interest continues to accrue on the unpaid balance from the date of judgment until the debtor actually pays what they owe, which can add up meaningfully if payment is delayed.
Rates for both prejudgment and postjudgment interest under the Courts of Justice Act are set quarterly by the province and can change from one quarter to the next, so the applicable rate depends on the specific period in question.
In some cases, yes — if your contract specifies its own interest rate for late payment, that rate can apply instead of the statutory default, provided it is properly documented and not otherwise unenforceable.
You should specifically claim interest in your Statement of Claim to ensure it is properly considered and awarded — it is not always assumed automatically, particularly prejudgment interest.