Quick answer
Payment terms tell the client when payment is due. Net 30 means 30 days after the invoice date, Net 15 means 15 days, and due on receipt means immediately. Pick the shortest term your clients will accept and state it on the invoice and in the email.
Quick answer
Invoice payment terms tell the client when the invoice is due. Net 30 means the full amount is due 30 days after the invoice date. Net 60 means 60 days. Due on receipt means pay as soon as the invoice arrives.
What Are Payment Terms?
Payment terms specify when a client must pay an invoice. They establish the timeline for payment and set professional expectations between you and your clients. Clear payment terms reduce confusion, minimize late payments, and help you maintain a healthy cash flow.
Payment Terms by Type
Every term belongs to one of five families. Read the summary here, then open the full page for examples and invoice wording.
-
Net terms (Net 7 to Net 90)
The full amount is due a set number of calendar days after the invoice date. Net 30 is the business-to-business default. Net 7 and Net 15 suit freelancers and small jobs, while Net 60 and Net 90 usually come from large companies.
-
Early payment discounts
Written as discount, discount window, and deadline. 2/10 Net 30 means 2% off if paid within 10 days, otherwise the full amount is due in 30 days.
-
End of month (EOM)
The clock starts at the end of the invoice month, not the invoice date. Net 30 EOM on any March invoice is due April 30.
-
Proximo (prox)
The invoice is due on a set day of the following month. 10th prox on any March invoice is due April 10.
-
Pay now or pay first
Due on receipt asks for payment as soon as the invoice arrives. Cash on delivery collects at handover, and cash in advance collects before work starts.
To get an exact date for any of them, use the free invoice due date calculator.
Payment Terms at a Glance
| Term | When payment is due | Who it fits | Cash flow |
|---|---|---|---|
| Due on receipt | The invoice date | Freelancers, first-time clients, small amounts | Fastest |
| Net 7 | 7 days after the invoice date | Small projects that still need a short processing window | Fast |
| Net 15 | 15 days after the invoice date | Freelancers and retainers | Faster than Net 30 |
| Net 30 | 30 days after the invoice date | Most business-to-business work | A full month of waiting |
| Net 60 | 60 days after the invoice date | Large companies and government clients | Slow. Plan for the gap |
| 2/10 Net 30 | 2% off if paid in 10 days, otherwise 30 days | Clients who can pay early | Faster if they take the discount |
| End of month (EOM) | Last day of the invoice month | Wholesale and monthly payment runs | Depends on when you send the invoice |
Invoice Website fills the due date when you pick Due on receipt, Net 7, Net 15, or Net 30. Use custom terms for Net 60, 2/10 Net 30, and end of month.
Net Payment Terms Explained
Step 01: What Are Net Payment Terms?
Net payment terms give the client a set number of calendar days to pay the full invoice amount, counted from the invoice date. "Net" means the total amount due after any deductions, and the number is the days allowed. For example:
- Net 7 = Payment due within 7 days
- Net 10 = Payment due within 10 days
- Net 15 = Payment due within 15 days
- Net 30 = Payment due within 30 days
- Net 45 = Payment due within 45 days
- Net 60 = Payment due within 60 days
- Net 90 = Payment due within 90 days
The countdown typically starts from the invoice date, not the date the client receives the invoice. Weekends and holidays count, so Net 30 is 30 calendar days, not 30 business days.
Example
If you send a Net 30 invoice dated March 1, your client has until March 31 to pay the full amount. If the invoice is Net 15, payment would be due by March 16.
Calculate the due date
Pick an invoice date and a term. You will get the due date and a line you can put on the invoice.
Choose an invoice date to see the due date.
Due on receipt, Net 7, Net 15, and Net 30 fill the due date in Invoice Website. Other terms, such as Net 45, Net 60, 2/10 Net 30, EOM, and prox, go in custom terms.
Step 02: Net 30: The Most Common Payment Term
Net 30 is the industry standard for most businesses. It gives clients a full 30 days from the invoice date to submit payment, which is long enough for most companies to process invoices through their accounts payable departments.
Pros:
- Widely understood and accepted across industries
- Gives clients reasonable time to process payment
- Standard in most B2B transactions
- Balances your cash flow needs with client expectations
Cons:
- Can strain cash flow for small businesses or freelancers
- Some clients may still pay late, pushing payment to 45–60 days
- Ties up working capital for a full month
When to Use Net 30
Net 30 is ideal for established client relationships, B2B services, and industries where it is the standard. If you're a freelancer with tight cash flow, consider shorter terms like Net 15 or due on receipt for new clients.
Due date examples and sample invoice wording: Net 30 payment terms.
Step 03: Net 15: Faster Payment
Net 15 requires payment within 15 days of the invoice date. It's a popular choice for freelancers, consultants, and small businesses that need faster access to their earnings.
Pros:
- Faster cash flow compared to Net 30
- Reduces the risk of late payment
- Keeps your working capital healthy
- Encourages clients to prioritize your invoice
Cons:
- May not suit clients with monthly payment cycles
- Some larger companies may push back on shorter terms
- Could feel aggressive with new clients
When to Use Net 15
Net 15 works well for freelancers, small projects, ongoing retainer work, and clients you've built trust with. It's also a good default for new client relationships where you want to establish prompt payment habits early.
Due date examples and sample invoice wording: Net 15 payment terms.
Step 04: Net 60: Extended Payment Terms
Net 60 gives clients 60 days to pay. This is common in industries that deal with large corporations, government agencies, or complex procurement processes.
Pros:
- Attractive to large corporations and government clients
- Can help you win contracts with enterprise clients
- Standard in certain industries (manufacturing, wholesale)
Cons:
- Significant impact on cash flow, you wait two months for payment
- Higher risk of non-payment over longer periods
- May require you to secure bridge financing
- Late payments can push actual receipt to 90+ days
When to Use Net 60
Only use Net 60 when working with large, creditworthy organizations that require extended terms, or in industries where it is standard practice. Make sure your business can absorb the cash flow delay before agreeing to these terms.
Due date examples and sample invoice wording: Net 60 payment terms.
Other Common Payment Terms
Step 05: Due on Receipt / Due Immediately
Due on receipt means payment is expected as soon as the client receives the invoice. There's no grace period, the client should pay immediately or as quickly as possible.
- Common for freelancers, one-time projects, and retail transactions
- Best for small amounts or first-time clients
- Provides the fastest cash flow of any payment term
- May not be realistic for larger invoices or corporate clients
Step 06: Due Upon Completion
Due upon completion means payment is expected when the work is finished or the product is delivered. This term ties payment directly to project milestones rather than a calendar date.
- Common for project-based work, construction, and creative services
- Clearly ties payment to deliverables
- Can be combined with milestone payments for larger projects
- Requires clear definition of what "completion" means in your contract
Step 07: Early Payment Discounts (2/10 Net 30)
2/10 Net 30 gives the client 2% off if they pay within 10 days. Otherwise the full amount is due in 30 days. The same pattern covers 1/10 Net 30 (1% off) and 2/10 Net 60 (a 60-day deadline).
The math, invoice wording, and when a discount is worth offering: 2/10 Net 30, 1/10 Net 30, and 2/10 Net 60.
Step 08: End of Month (EOM)
End of month (EOM) terms count from the last day of the invoice month instead of the invoice date. Net 30 EOM means 30 days after the month ends, so every invoice from one month shares the same due date. It is common in wholesale and with clients who pay suppliers once a month.
Worked examples and how EOM compares with Net 30: EOM payment terms.
Step 09: Proximo (Prox)
Proximo (often shortened to "prox") makes the invoice due on a set day of the following month. "15th prox" means payment is due on the 15th of the month after the invoice date. It is most common in wholesale and in the UK and Australia.
Examples and how prox differs from EOM: prox payment terms.
Free to start
Set the due date automatically.
Choose Due on receipt, Net 7, Net 15, or Net 30. Custom terms cover Net 60 and early-payment discounts.
How to Choose the Right Payment Terms
Consider Your Cash Flow Needs
Your payment terms directly affect when money hits your account. If you have recurring expenses like rent, software subscriptions, or subcontractor payments, shorter terms (Net 15 or due on receipt) keep cash flowing. If your business has healthy reserves, you may be able to offer Net 30 or longer without stress.
Consider Your Client's Payment Cycle
Large corporations and government agencies often have fixed payment cycles (e.g., they process invoices once or twice a month). Understanding your client's cycle helps you set terms they can realistically meet, reducing late payments and friction.
Consider Industry Standards
Different industries have different norms. Construction and manufacturing often use Net 60 or longer. Creative agencies and freelancers typically use Net 15 or Net 30. Matching industry standards makes your terms feel familiar and reasonable to clients.
Consider Your Relationship with the Client
For new clients, shorter terms (Net 15 or due on receipt) reduce your risk. As trust builds and the client demonstrates reliable payment, you can offer more flexible terms. Long-standing clients with a strong payment history may appreciate Net 30 or even Net 60 as a gesture of trust.
Payment Terms by Business Type
Freelancers
Net 15 or due on receipt, keep cash flowing and reduce late payment risk
Small Businesses
Net 15 to Net 30, balance client convenience with cash flow needs
B2B Services
Net 30, the industry standard for business-to-business transactions
Enterprise Clients
Net 30 to Net 60, accommodate longer procurement and approval cycles
Best Practices for Payment Terms
Be Clear and Specific
Always state your payment terms explicitly on the invoice. Instead of writing "payment due soon," use specific language like "Net 30, Payment due within 30 days of invoice date." Include the exact due date so there's no ambiguity.
Include Payment Terms in Your Contract
Don't wait until the invoice to introduce payment terms. Include them in your contract, proposal, or statement of work so clients agree to the terms before work begins. This gives you legal backing if a payment dispute arises.
Consider Late Payment Fees
Adding a late payment fee encourages on-time payment. Common approaches include:
- A flat fee (e.g., $25 late fee after the due date)
- A percentage of the invoice amount (e.g., 1.5% per month)
- Daily interest charges (e.g., 0.05% per day past due)
Always disclose late fees in your contract and on the invoice so clients are aware before they're charged.
Offer Early Payment Discounts
Incentivize faster payment by offering a small discount for early payment (e.g., 2/10 Net 30). While you receive slightly less per invoice, the improved cash flow and reduced collection effort often more than make up for the discount.
Common Payment Terms Mistakes
Mistakes to Avoid
- Not specifying payment terms at all, clients won't know when to pay, leading to delays
- Using vague language, "pay when you can" is not a payment term
- Setting terms that don't match your cash flow, offering Net 60 when you need money in two weeks
- Not enforcing your terms, letting late payments slide sets a bad precedent
- Failing to communicate terms upfront, surprising clients with terms on the invoice instead of the contract
- Using the same terms for every client, a startup and a Fortune 500 company have very different payment capabilities
- Ignoring industry norms, overly aggressive terms can cost you clients
How to Display Payment Terms on Your Invoice
Placement and Formatting
Payment terms should be prominently displayed on your invoice, not buried in fine print. Place them near the total amount due or in a dedicated "Payment Terms" section. Include:
- The payment term (e.g., "Net 30")
- The exact due date (e.g., "Due by April 15, 2026")
- Accepted payment methods
- Any early payment discounts or late fees
- Payment instructions (bank details, online payment link, and so on)
Free to start
Put these terms on an invoice.
Pick Due on receipt, Net 7, Net 15, or Net 30 and the due date fills in. Custom terms cover Net 60 and early-payment discounts.
Payment Terms FAQ
What does Net 30 mean on an invoice?
Net 30 means the full invoice amount is due 30 days after the invoice date. If the invoice is dated March 1, payment is due March 31.
When does the Net 30 clock start?
The countdown starts on the invoice date, not the day the client opens the email, unless your contract says otherwise.
What is the difference between Net 30 and Net 60?
Net 30 is due in 30 days. Net 60 is due in 60 days. Net 60 is common with large companies and government clients, and it ties up cash for twice as long.
What does 2/10 Net 30 mean?
The client can take a 2% discount if they pay within 10 days. If they miss that window, the full amount is due in 30 days. On a $5,000 invoice, paying within 10 days means $4,900.
What payment terms should freelancers use?
Net 15 or due on receipt is a practical default, especially with new clients. Net 7 is a middle ground when you want faster cash without asking for payment the same day. Net 30 is reasonable once a client pays on time.