Invoice Payment Terms Explained: Net 30, Due on Receipt and More

Payment terms are the conditions on your invoice that tell the client when payment is due and how to pay. The most common terms are Due on receipt, Net 7, Net 14 and Net 30, where the number is the days the client has to pay after the invoice date. Shorter terms usually mean faster payment, so pick the shortest terms your clients will accept.

Common invoice payment terms and what they mean

Term	What it means
Due on receipt	Pay as soon as the invoice arrives
Net 7	Pay within 7 days of the invoice date
Net 14	Pay within 14 days of the invoice date
Net 30	Pay within 30 days of the invoice date
Net 60	Pay within 60 days of the invoice date
EOM	Pay by the end of the month the invoice is dated
2/10 Net 30	Take 2% off if paid within 10 days, otherwise pay in full within 30 days
CIA	Cash in advance: pay before the work starts
50% upfront	Half before the work starts, the rest on completion

Which payment terms should you use?

The right terms depend on who you work with and how much risk you can carry.

• Freelancers and small jobs: Due on receipt or Net 7. Small amounts should be paid quickly.
• Regular business clients: Net 14 or Net 30. Larger companies often pay on a fixed cycle, so ask what they use before you start.
• Big projects: ask for a deposit, such as 50% upfront, then invoice the balance on completion.
• New clients: keep terms short, or ask for payment in advance, until they have paid you on time a few times.

Whatever you choose, agree the terms before the work starts and put them in your quote or contract, so the invoice holds no surprises.

How to write payment terms on an invoice

Put the terms close to the total, where the client looks first. Good payment terms are short and specific:

1. State the terms, for example "Net 14".
2. Write the actual due date, for example "Due 10 November 2026".
3. Say how to pay: bank details, PayPal or a payment link.
4. Mention any late fee or early payment discount you have agreed.

Here is a simple example you can copy:

In the free InvoiceGeneratorKit invoice generator you can type your own terms or tap a ready made option such as Net 7, Net 14 or Net 30, and the due date is shown on the invoice.

Late payment fees

A late fee can encourage clients to pay on time, but it must be agreed in advance. Write it in your contract and repeat it in your payment terms, for example "A late fee of 2% per month applies to overdue balances". Check what your local law allows before you set one.

In the UK, businesses can claim statutory interest on late commercial payments under the Late Payment of Commercial Debts (Interest) Act. The rate is 8% above the Bank of England base rate, and you can also claim a fixed sum for debt recovery costs.

Early payment discounts

Terms such as 2/10 Net 30 reward clients who pay quickly. They can speed up your cash flow, but you give up part of your fee, so use them when getting paid fast matters more than the full amount.

Tips to get paid on time

• Send the invoice as soon as the work is finished.
• Always include a due date, not only "Net 30".
• Make paying easy: clear bank details or a payment link.
• Send a friendly reminder a few days before the due date and again the day after.
• Track which invoices are paid. InvoiceGeneratorKit marks overdue invoices for you in History.

Need the basics first? Read how to generate an invoice and what to include on an invoice.

Frequently asked questions

What does Net 30 mean on an invoice?

Net 30 means the client must pay the full amount within 30 days of the invoice date. For an invoice dated 1 March, payment is due by 31 March.

What is the best payment term for freelancers?

Due on receipt or Net 7 works well for most freelance work. For larger projects, ask for a deposit upfront and invoice the balance on completion.

Is Net 30 from the invoice date or the delivery date?

It normally runs from the invoice date. If you mean something else, say so clearly on the invoice and write the exact due date.

Can I change payment terms after sending an invoice?

Only if the client agrees. Terms should be agreed before the work starts, and the invoice should match that agreement.