Contract Penalty / Liquidated Damages Calculator
Estimate contract breach exposure from daily penalties, percent-based clauses, cure periods, and caps.
Last updated: 2026-03-26
Estimate penalty exposure
Enter your values
Model the clause the way it appears in the contract, then apply cure periods and caps.
Estimated exposure
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Enter your contract terms to estimate the penalty amount, chargeable days, and contract-value exposure.
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Example calculations
Tap an example to prefill the calculator with sample values.
Vendor delay
$250 per day after a 3-day cure period
A common liquidated-damages clause where the daily penalty starts only after the grace period expires.
Result: A clean way to estimate the accrued exposure before legal review or settlement talks.
Percent-based clause
0.25% of contract value per day, capped at $12,000
Useful when the clause scales with contract size instead of a flat daily fee.
Result: Percent-based penalties escalate fast on larger contracts, which is why the cap matters.
One-time breach fee
Flat $2,500 once the breach occurs
Some clauses define a fixed penalty rather than an accruing daily amount.
Result: One-time penalty clauses are simpler to model because timing does not keep compounding the exposure.
How liquidated damages are estimated
The calculator first removes any cure-period days from the total delay or breach length. It then applies either a flat daily charge, a percentage of contract value per day, or a one-time fixed penalty depending on the clause structure you select.
If the contract includes a maximum penalty cap, the estimate stops at that ceiling and shows how much exposure the cap trimmed off. That makes it easier to model both the raw clause economics and the practical upper bound.
Contract penalty FAQs
Use the estimate to understand clause economics before you hand the issue to legal or commercial teams.
What is a cure period?
A cure period is the number of days a party gets to fix a breach before penalties begin to accrue. If a contract includes one, those days usually reduce or eliminate the chargeable period.
Why include both fixed and percent-per-day modes?
Because real clauses vary. Some use a flat dollar amount each day, some use a one-time fee, and some scale the penalty as a percentage of contract value.
Does a penalty cap always apply automatically?
No. Only use a cap if the contract actually includes one or if you are modeling a negotiated settlement ceiling. Otherwise set the cap to zero and the calculator will leave the exposure uncapped.
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Legal disclaimer
This calculator is for planning and negotiation prep only. It does not determine whether a liquidated-damages clause is enforceable.
Contract wording, governing law, mitigation duties, and actual damages all matter. Have counsel review the clause before relying on this estimate in a real dispute.