Invoice Payment Terms: Net 30 and More, Explained
Updated
Payment terms tell your client how long they have to pay. They're short codes, but they decide when cash lands in your account, so it pays to choose them on purpose rather than by habit.
The common terms
| Term | What it means |
|---|---|
| Due on receipt | Pay as soon as the invoice arrives. Common for small one-off jobs. |
| Net 7 / Net 10 | Due 7 or 10 days after the invoice date. Good for short projects. |
| Net 15 | Due 15 days after the invoice date. A sensible default for freelancers. |
| Net 30 | Due 30 days after the invoice date. The most common term between businesses. |
| Net 60 / Net 90 | Due 60 or 90 days later. Often demanded by large companies. |
| Net EOM | Due at the end of the month the invoice is dated. “Net 30 EOM” means 30 days after that month ends. Write the actual date too. |
| 2/10 Net 30 | Take 2% off if you pay within 10 days; otherwise the full amount is due in 30. |
| CIA / CWO | Cash in advance, cash with order: payment before the work starts. |
| 50% upfront | Half before you start, the rest on completion. Common for larger projects. |
How to count the due date
Count calendar days, not business days, starting the day after the invoice date. An invoice dated March 3 on Net 30 is due April 2. If your contract counts from the day the client receives the invoice instead, say so on the invoice.
Terms: Net 30
Due date: April 2
Choosing your terms
- Agree on terms before the work starts, in your quote or contract. Terms that first appear on the invoice are easy to ignore.
- Default to Net 15 or shorter for individuals and small businesses. Many will pay faster simply because you asked.
- Expect Net 30 to Net 60 from larger companies; their payables teams run on a schedule. Price that wait into the job.
- Ask for a deposit on big or long projects, so you're never carrying weeks of unpaid work.
- Offer an early-payment discount such as 2/10 Net 30 only if getting paid sooner is worth the 2% to you.
Terms that tend to cause trouble
“Upon completion,” “when convenient” and no terms at all. Each leaves the due date open to interpretation, and an open due date is the easiest one to miss. If the client pays late anyway, the next step is a polite reminder and, if you agreed on one up front, a late fee.
Questions
What does Net 30 mean on an invoice?
The client has 30 calendar days from the invoice date to pay the full amount. An invoice dated June 1 on Net 30 is due July 1.
Is Net 30 the same as 30 business days?
No. Net terms count calendar days, weekends and holidays included, unless your contract says otherwise.
What does 2/10 Net 30 mean?
The client may take 2% off the invoice if they pay within 10 days of the invoice date. If not, the full amount is due within 30 days.
Can I change payment terms for an existing client?
Yes, but tell them before the next invoice, not on it. Put the new terms in writing and give them time to adjust their payment schedule.
Ready to send yours?
The free generator sets the due date in one tap: On receipt, Net 15, Net 30 or Net 60.