Invoice Payment Terms Explained: Net 30, Due on Receipt and More
Updated
Payment terms tell your client when an invoice must be paid and what happens if it isn't. Choosing them deliberately, and writing them clearly, is the simplest way to improve your cash flow.
Common payment terms
| Term | Meaning |
|---|---|
| Due on receipt | Payment is expected as soon as the invoice arrives. |
| Net 7 / Net 14 / Net 15 | Due 7, 14 or 15 days after the invoice date. |
| Net 30 | Due 30 days after the invoice date. The most common term between businesses. |
| Net 60 / Net 90 | Long terms, usually demanded by large corporate buyers. |
| EOM | Due at the end of the month the invoice is issued. |
| Net 30 EOM | Due 30 days after the end of the invoice month. |
| 2/10 Net 30 | 2% discount if paid within 10 days; otherwise the full amount is due in 30. |
| CIA / CWO | Cash in advance / cash with order: payment before work starts. |
| COD | Cash on delivery. |
Which terms should you use?
Shorter terms get you paid sooner. Freelancers and small agencies often use Net 14 or Due on receipt. Net 30 is the safe default for business clients, and many will expect it. If a large customer insists on Net 60 or more, factor the wait into your price or ask for a deposit.
Laws that may override your terms
Some jurisdictions cap or define payment periods. In the EU, the Late Payment Directive sets a default of 30 days and a 60-day limit for most business-to-business contracts unless otherwise agreed and not grossly unfair. The UK gives businesses a statutory right to charge interest on late commercial payments. Check the rules that apply to you and your client.
How to write terms on an invoice
Always pair the term with an actual date, and say what happens if payment is late:
“Payment terms: Net 30. Due 11 December 2026. Invoices unpaid after the due date incur a late fee of 1.5% per month.”
In the invoice generator, type or pick the payment term and the due date is calculated for you.
Tips for getting paid on time
- Agree terms in your contract or quote before the work starts.
- Invoice promptly; the clock starts when the invoice is issued.
- Offer an early-payment discount such as 2/10 Net 30.
- Send a friendly reminder a few days before the due date.
- Make paying easy: bank details and a payment link on every invoice.