Late Payment Interest - Permitted or Forbidden?
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Question
An employer did not pay pension contributions for a year, and now the law requires him to pay late payment interest (which amounts to about 300 shekels), which does not really cover the actual damage caused. Is it permissible to take this late payment interest, or is there a halachic issue, as the accountant told me that he knows there are those who believe there is a problem with it?
Answer
Hello
It is not permissible to take the interest
Source
According to the instructions of the Gaon, Rabbi Avraham Fried, shlita
See Yoreh De'ah, Siman 173, Sif 14 and see Beit Yosef and Bach, Siman 161