Guide

Invoice payment terms: what they mean and how to write them

Published October 16, 2026 · By RecordSplit

Invoice payment terms tell your customer when you expect to be paid. They usually say how long the customer has to pay, such as "Net 30" or "due upon receipt", and can also cover how to pay, deposits, discounts for paying early or other conditions you agreed.

Payment terms aren't the same as the due date. The terms are the rule; the due date is the actual date that rule produces for one invoice. "Net 30" on an invoice dated October 1 gives a due date of October 31.

This guide compares the common terms, shows how to write them on an invoice with copy-ready wording, and covers deposits, early-payment discounts and what to do when an invoice is paid late. If you invoice with RecordSplit, see how invoicing and receivables handles due dates and terms.

Common invoice payment terms

These are the payment terms you'll see most often on invoices. None of them is a universal standard: which one fits depends on your business, your customers and what you agree with them.

Common payment terms, with example due dates for an invoice dated October 1, 2026, counting calendar days
Payment term	Meaning	Example due date	Typical use
Due upon receipt	Payment is expected as soon as the customer receives the invoice	Depends on when it's received	One-off jobs, new customers, small amounts
Net 7	Payment is due within 7 days of the invoice date	October 8, 2026	Short jobs and quick payment cycles
Net 15	Payment is due within 15 days	October 16, 2026	A short credit period
Net 30	Payment is due within 30 days	October 31, 2026	Common in business-to-business invoicing
Net 45	Payment is due within 45 days	November 15, 2026	Longer payment cycles
Net 60	Payment is due within 60 days	November 30, 2026	Extended periods, often for larger customers
Net 90	Payment is due within 90 days	December 30, 2026	Longer credit arrangements

The dates count calendar days, including weekends, from the invoice date. To work out the due date for any invoice date or number of days, use the invoice due date calculator.

Some terms don't reduce to a number of days:

Other payment terms you may see on invoices
Payment term	What it means
End of month (EOM)	Payment is tied to the end of a month rather than the invoice date. "30 EOM" usually means 30 days after the end of the month the invoice is dated in. Usage varies, so spell out the date.
2/10 Net 30	An early-payment discount: the customer may take 2% off by paying within 10 days; otherwise the full amount is due within 30 days.
Payment in advance	The customer pays in full before the work starts or the goods are sent.
Deposit	Part of the price is paid up front, and the rest later, often on completion.
Milestone payments	Payments fall due as agreed stages of a project are completed, so the dates depend on the project, not the calendar.

Payment terms vs the invoice due date

Payment terms describe the arrangement you agreed with the customer. The due date is the specific day payment is expected on one invoice, worked out from those terms and the invoice date.

One invoice, one set of terms

Payment terms: Net 30
Invoice date: October 1, 2026
Due date: October 31, 2026

October 31, 2026 is a Saturday. Whether payment can wait until the next business day depends on your agreement.

Put both on the invoice: the terms explain the rule, and the due date removes any doubt about which day you mean. Counting questions such as calendar days versus business days, and dates that fall on a weekend, are covered on the due date calculator page.

How to write payment terms on an invoice

Good payment terms are short, specific and impossible to misread. Put them near the total or the due date, use the same wording on every invoice, and make sure they match what you agreed with the customer. Here are examples you can adapt:

Due upon receipt

Payment is due upon receipt of this invoice.

Net 15

Payment is due within 15 calendar days of the invoice date.

Net 30

Payment is due within 30 calendar days of the invoice date.

Net 60

Payment is due within 60 calendar days of the invoice date.

Payment in advance

Payment is required in full before work begins.

Deposit

A 50% deposit is due before work begins. The remaining balance is due on completion.

Milestone payments

Each payment is due when the matching project milestone, as agreed for this project, is completed.

Early-payment discount (2/10 Net 30)

Take a 2% discount if payment is received within 10 days of the invoice date. Otherwise, the full amount is due within 30 days.

Next to the terms, say how to pay: bank transfer details, the payment methods you accept, or who to contact. The terms say when; the payment instructions say how.

About these examples

These are plain-English examples of invoice wording, not contract clauses or legal advice. Use terms you have agreed with your customer, and check your contract if the invoice has to match it.

How to choose payment terms

There's no single best payment term. A few things usually shape the choice:

Your cash flow: the longer customers take to pay, the longer you carry the cost of the work.
The customer's payment history: a customer who pays reliably may get longer terms than a new one.
The invoice amount: small amounts are often due on receipt or within a few days.
How long the project runs: long projects often use deposits or milestone payments instead of one invoice at the end.
The relationship: larger customers may ask for their own standard terms.
What's usual in your industry: customers may expect terms similar to other suppliers'.
Your admin time: longer terms mean more open invoices to track and follow up.
Consistency: using the same terms for similar customers makes them easier to apply and explain.

Shorter terms bring cash in sooner but can be harder for some customers to meet. Longer terms can suit customers with slower approval processes but leave more money outstanding. Whatever you choose, agree it before the work starts, not on the invoice afterwards.

Deposits, milestones and partial payments

These three are often confused:

A deposit is part of the price paid up front, before the work starts. The rest is paid later.
Milestone payments split a project into agreed stages, with a payment due as each stage is completed.
A partial payment is a customer paying part of an invoice they already have. The rest of that invoice is still owed.

RecordSplit records partial payments against an invoice, and the invoice shows what is still owed. It doesn't have dedicated deposit or milestone invoices; you can describe a deposit or milestone arrangement in the invoice's terms and record each payment as it arrives.

Early-payment discounts

"2/10 Net 30" means the customer may take a 2% discount by paying within 10 days of the invoice date; otherwise the full amount is due within 30 days.

2/10 Net 30 on a $1,000 invoice dated October 1, 2026 — example figures

Paid by October 11, 2026 (within 10 days): $980.00
Otherwise, due by October 31, 2026: $1,000.00

A discount trades a little revenue for faster payment. Offer one only if it suits your margins, and put the exact terms on the invoice.

What happens when an invoice is paid late?

When the due date passes without payment, work through the basics before anything else:

Check the invoice status, so you know nothing has been recorded since.
Check whether a payment is already on its way or still processing.
Confirm the due date the customer agreed to.
Contact the customer politely to ask about it.
Send a payment reminder that states the amount, the due date and how to pay.
Keep following up on whatever balance is still unpaid.

For wording at each stage, from a friendly note to a final reminder, use these payment reminder email templates.

A late fee belongs on an overdue invoice only if your agreement with the customer includes one and it is permitted where you do business. If it does, the late fee calculatorworks out the charge at the rate you already agreed. It doesn't tell you whether a fee is allowed.

How RecordSplit handles invoice payment terms

Set your default payment due days and invoice terms once, then adjust individual draft invoices when needed:

In Invoice Settings, set Payment due (days), which starts at 14, and default Terms and Payment instructions text.
Each new draft invoice gets a due date of the issue date plus that many calendar days, with your default Terms and Payment instructions filled in.
On a draft, you can change the due date, the Terms and the Payment instructions for that invoice before you issue it.
The Terms and Payment instructions appear on the invoice your customer views and on its PDF.
Record payments in full or in part as they arrive, and send a payment reminder when you decide to.

Terms text and the due date are separate

The due date comes from the number of days you set, not from the Terms text. Typing "Net 30" in Terms doesn't change the due date, so keep the two in step.

RecordSplit doesn't have a Net 15 / Net 30 / Net 60 selector, deposit or milestone invoices, early-payment discounts, late fees or interest, or scheduled reminders, and it doesn't collect payments online. See invoicing and receivables for what it does.

To keep an eye on due dates outside RecordSplit, the free invoice tracker spreadsheet lists each invoice with its due date, status and days overdue, and the accounts receivable aging template shows how much is still current and how much has moved past its due date.

Frequently asked questions

What are payment terms on an invoice?

Payment terms on an invoice tell the customer when payment is expected, such as within 30 days of the invoice date or as soon as the invoice is received. They can also say how to pay and mention deposits, early-payment discounts or other conditions agreed with the customer before the work.

What are common invoice payment terms?

Common invoice payment terms include due upon receipt, Net 7, Net 15, Net 30, Net 45, Net 60 and Net 90, where the number is the days the customer has to pay after the invoice date. Others include end of month (EOM), payment in advance, deposits, milestone payments and early-payment discounts such as 2/10 Net 30.

How do you write payment terms on an invoice?

Write one short, specific sentence near the total or due date, such as "Payment is due within 30 calendar days of the invoice date." Show the actual due date too, say how to pay, and use the same wording on every invoice so customers always know what you expect and when.

What is an example of invoice payment terms?

A common example is "Net 30: payment is due within 30 calendar days of the invoice date." An invoice dated October 1, 2026 on those terms is due on October 31, 2026. Other examples are "Payment is due upon receipt of this invoice" or a 50% deposit before work begins, with the balance on completion.

What's the difference between payment terms and a due date?

Payment terms are the agreed rule for when payment is expected, such as Net 30. The due date is the specific date that rule gives for one invoice: with Net 30, an invoice dated October 1, 2026 is due on October 31, 2026. Showing both on the invoice avoids any confusion about the deadline.

What does payment terms 14 days net mean?

"14 days net" means the full invoice amount is due within 14 days of the invoice date, the same as Net 14. "Net" means the full amount, with no discount for paying early. For an invoice dated October 1, 2026, payment would be due by October 15, 2026, counting calendar days.

What does 30 EOM mean?

"30 EOM" usually means payment is due 30 days after the end of the month the invoice is dated in. An invoice dated October 10 would run to October 31, then 30 more days, so payment would be due by November 30. Businesses use EOM terms differently, so it's clearest to state the exact due date.

Should a small business use Net 15 or Net 30?

It depends on your cash flow and your customers. Net 15 brings payment in sooner, which helps if you can't wait a month. Net 30 is common in business-to-business work and can suit customers with slower approval processes. Whichever you choose, agree it in advance and apply it consistently.

Put your due date and terms on every invoice.

Set default payment due days, terms and payment instructions once, and adjust each draft invoice when you need to. Record payments as they arrive and see what's still owed.

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