Guide
Invoice payment terms explained
Net 30, Due on receipt, 2/10 Net 30: what each term means, the exact due date it gives, when it suits you, and how to put it on an invoice.
Common payment terms at a glance
Payment terms say when the invoice must be paid. “Net” means the full amount, with no discount, and the number is how many calendar days after the invoice date the payment is due. The dates below are for an invoice dated 1 November 2026.
| Term | What it means | Due date | Typical use |
|---|---|---|---|
| Due on receipt | Pay as soon as the invoice arrives. The due date is the invoice date. | 1 Nov 2026 | Repairs, one-off jobs, consumers, new clients |
| Net 7 | Full amount within 7 days. | 8 Nov 2026 | Weekly services, tutoring, small jobs |
| Net 15 | Full amount within 15 days. | 16 Nov 2026 | Freelancers, short projects, trades |
| Net 30 | Full amount within 30 days. | 1 Dec 2026 | The usual business-to-business term |
| Net 45 | Full amount within 45 days. | 16 Dec 2026 | Clients that pay in fortnightly or monthly runs |
| Net 60 | Full amount within 60 days. | 31 Dec 2026 | Large companies’ standard supplier terms |
| Net 90 | Full amount within 90 days. | 30 Jan 2027 | Some retailers and public bodies; costly for small suppliers |
| 2/10 Net 30 | 2% off if paid within 10 days, otherwise the full amount within 30. | 11 Nov 2026 with discount, 1 Dec 2026 in full | Suppliers who want cash sooner and can afford the discount |
| EOM | End of month. Usually due on the last day of the invoice’s month; some firms read it differently, so write the date. | 30 Nov 2026 | Clients that pay once a month |
| Net 30 EOM | 30 days after the end of the invoice’s month. | 30 Dec 2026 | Monthly statements between businesses |
| Payment in advance | Pay before work starts or goods ship (also CIA, “cash in advance”). | Before delivery | Custom orders, new or overseas buyers |
Whatever term you choose, also print the due date itself. “Net 30” leaves room for argument about where the count starts; “Due 1 December 2026” does not.
Which term should you use?
- Agree it before you start. Put the term in your quote, proposal or contract, then repeat it on the invoice. A term that appears for the first time on the invoice is easy for a client to ignore.
- Match how the client pays. Many companies pay suppliers in weekly or monthly runs. Asking a large company for Due on receipt usually means you are paid in its next run anyway, so ask its accounts team when that is.
- Shorter for people, longer for companies. Consumers and small one-off jobs are usually Due on receipt or Net 7. Net 30 is the common default between businesses.
- Long terms are a loan. On Net 60 or Net 90 you are financing your client. Price it in, or ask for a deposit up front.
- Some places limit long terms. In the EU, the Late Payment Directive caps business-to-business payment periods at 60 days unless both sides expressly agree otherwise and it is not grossly unfair to the supplier, and public authorities generally have 30 days (Directive 2011/7/EU (late payment)). The late payment guide covers the interest you can claim.
2/10 Net 30, worked out
An invoice for $2,500.00 dated 1 November 2026 on 2/10 Net 30 terms can be settled in one of two ways:
- $2,450.00 by 11 November 2026: the 2% discount ($50.00) for paying within 10 days.
- $2,500.00 by 1 December 2026: the full amount within 30 days.
For the client, skipping the discount means paying $50 to keep $2,450 for 20 more days. That is about 37% a year (2/98 × 365/20), which is why finance teams usually take it. For you, it is the cost of getting paid three weeks sooner. Offer it only if your margins allow.
Billpad does not have a 2/10 Net 30 option that changes the totals, because the amount the client pays depends on when they pay. Set the terms to Net 30 so the due date is right, and state the discount and its deadline in the notes, as the template below does.
Setting payment terms in Billpad
- On the invoice, choose a term in Payment terms: Due on receipt, Net 7, 15, 30, 45, 60 or 90. The Due date is filled in from the issue date, counting calendar days.
- For anything else (EOM, a fixed date, a payment plan), pick Custom date and type the due date. Typing your own date switches the term to Custom by itself.
- Explain any discount, deposit or late fee in Notes. If a deposit has already been paid, use + Payment received so the invoice shows the balance due.
Each template opens in the generator with the term and a matching note already set. Your own saved draft is kept until you start editing the template.
Payment terms wording you can copy
- “Payment terms: Net 30. Please pay the full amount by 1 December 2026, quoting invoice INV-0103.”
- “Payment is due on receipt. Thank you for your business.”
- “Terms 2/10 Net 30: deduct 2% ($50.00) if paid by 11 November 2026; otherwise $2,500.00 is due by 1 December 2026.”
- “50% deposit due on acceptance of this quote; balance due on completion.”
- “Payable in three monthly instalments of $400.00 on 1 December, 1 January and 1 February.”
Trades often use Due on receipt (see the plumbing invoice template), while consultants and agencies usually bill Net 30 against a purchase order (see the consulting invoice template).
Updated 28 October 2026. General information, not legal or tax advice. Spotted an error or an outdated rule? Contact us. About Billpad.