How to Write Payment Terms on an Invoice (With Examples)

Why Payment Terms Matter

Payment terms are the agreement between you and your client about when payment is due and under what conditions. Vague terms ("payment due soon") create ambiguity and give late payers cover. Clear, specific terms create a shared understanding — and a legal basis for chasing payment.

Setting good payment terms is one of the simplest things you can do to improve your cash flow.

Common Payment Term Options

Net 7, Net 14, Net 30, Net 60

"Net" followed by a number means payment is due within that many days of the invoice date. Net 30 means payment is due within 30 days.

Net 30 has been the traditional standard in B2B transactions, but many businesses are now moving to Net 14 or Net 7 for smaller amounts. Shorter terms mean faster payment and a shorter chase cycle if payment is late.

Due on receipt

Payment is due when the client receives the invoice. In practice, this means immediately. Use for small amounts or clients who have previously paid late. The ambiguity around what "receipt" means can cause friction, so "Due: [specific date]" is often cleaner.

EOM (End of Month)

Payment is due at the end of the month the invoice is issued. Common in certain industries. Less common for service businesses.

2/10 Net 30

2% discount if paid within 10 days, otherwise full amount due within 30 days. An early payment discount term. The "2/10" means "2% discount / 10 days."

50% upfront, 50% on completion

Common for project-based work. Split payment structure that protects both sides — you get something upfront, the client pays the balance when they see the finished result.

What to Actually Write on the Invoice

Don't just write "Net 30" — write it out clearly:

Option 1 (specific date):

"Payment due: 15 June 2025"

Option 2 (standard terms):

"Payment is due within 30 days of the invoice date. This invoice is due by 15 June 2025."

Option 3 (with late payment clause):

"Payment due within 14 days. Late payments may be subject to a 1.5% monthly interest charge."

Always include:

The specific due date (not just "Net 30" — calculate and write the date)

Accepted payment methods

Your bank details for bank transfer

Any early payment discount if applicable

Choosing the Right Payment Terms for Your Business

Consider your cash flow needs. If you pay suppliers or employees regularly, you need money coming in on a predictable schedule. Shorter terms help.

Consider your industry norms. Some industries have standard terms (Net 30 in many B2B sectors; payment on delivery in retail; upfront in some service industries). Wildly different terms may create friction.

Consider client size. Large corporations often have standard 45-day or 60-day AP cycles regardless of what your invoice says. For these clients, you can either match their terms or charge accordingly for the extended credit period.

Consider relationship history. For new clients, consider requiring a deposit or shorter terms until trust is established. For reliable long-term clients, flexibility is reasonable.

Late Payment Clauses

Adding a late payment clause to your invoices and contracts reinforces that overdue invoices have consequences. Common approaches:

Interest on late payments: "Invoices unpaid after the due date will accrue interest at 1.5% per month on the outstanding balance." Check your local regulations — many jurisdictions have statutory rates for late payment interest.

Fixed late fee: "A late payment fee of $[amount] applies to invoices not paid within 5 days of the due date."

Suspension of services: "Services may be suspended on accounts more than 30 days overdue."

Whether you enforce these strictly or use them purely as a deterrent is up to you. Having them on the invoice makes the expectation clear.

What Not to Write

Vague language: "Payment expected promptly," "Please pay when convenient," "Payment due ASAP." None of these create a clear obligation.

Conflicting terms: If your contract says Net 30 and your invoice says Net 14, expect confusion and disputes.

No due date: Writing only "Net 30" without calculating and writing the actual due date makes it easier for clients to claim they misunderstood.

Setting Terms in Quotation Expert

In Quotation Expert, you set default payment terms once — and they're applied to every invoice automatically. The due date is calculated from the invoice date based on your terms and shown on the invoice PDF. You can override terms per invoice when needed.