Examples are given below for illustration:

Example 1: The deadline falls on a Thursday.

Payments made on Friday, Saturday, or Sunday are not more than 3 days overdue, and therefore incur no late penalty.

Payments made on Monday, Tuesday, or Wednesday are more than 3 days overdue, and therefore a 1% late penalty is added (and so on).

Example 2: The deadline falls on a Friday.

Payments made on Saturday, Sunday, or Monday are not more than 3 days overdue, and therefore incur no late penalty.

Payments made on Tuesday, Wednesday, or Thursday are more than 3 days overdue, and therefore a 1% late penalty is added (and so on).

Example 3: The deadline falls on a Saturday or Sunday (extending the deadline to Monday).

Payments made on Tuesday, Wednesday, or Thursday are not more than 3 days overdue, and therefore incur no late penalty.

Payments made on Friday, Saturday, or Sunday are more than 3 days overdue, and therefore a 1% late penalty is added (and so on).

Example 4: The deadline is on a holiday (e.g. the holiday is on Wednesday, extending the deadline to Thursday).

Payments made on Friday, Saturday, or Sunday are not more than 3 days overdue, and therefore incur no late penalty.

Payments made on Monday, Tuesday, or Wednesday are more than 3 days overdue, and therefore a 1% late penalty is added (and so on).