Invoice payment terms explained: Net 30, Due on Receipt, 2/10 net 30
Payment terms tell your customer when the money is due. Clear terms on every invoice are the cheapest way to get paid faster.
The common terms
| Term | Meaning |
|---|---|
| Due on receipt | Payment is due as soon as the customer gets the invoice. |
| Net 7, Net 15 | The full amount is due 7 or 15 days after the invoice date. |
| Net 30 | The full amount is due 30 days after the invoice date. This is the most common term between businesses. |
| Net 60, Net 90 | Longer terms that large customers often ask for. They stretch your cash flow. |
| 2/10 net 30 | 2% discount if paid within 10 days, otherwise the full amount is due in 30 days. |
| Due by a date | A specific due date, for example for a final invoice at the end of a project. |
How the days are counted
“Net 30” counts from the invoice date, not from the day the customer opens the email. An invoice dated June 1 with Net 30 is due July 1. Write the actual due date on the invoice as well, so nobody has to calculate it.
Terms only work if they are agreed
Terms bind your customer when they were agreed in a contract, quote or order, or when the customer accepts them by paying on that schedule. If you have no agreement, say your terms on the quote before you start and repeat them on every invoice.
Is an early-payment discount worth it?
A discount such as 2/10 net 30 rewards fast payment, but it is expensive money. The customer who skips the discount pays 2% for keeping the cash 20 more days, which is roughly 37% a year (2 ÷ 98 × 365 ÷ 20). If you are short of cash that can be a good deal for you; if you are not, a shorter term such as Net 15 often works better. Late-payment charges are a separate topic: see late fees on invoices.
Frequently asked questions
What does Net 30 mean on an invoice?
The full amount is due 30 days after the invoice date.
What does 2/10 net 30 mean?
The customer may take 2% off if they pay within 10 days; otherwise the full amount is due within 30 days.
Which payment terms should a freelancer use?
Many freelancers use Net 15 or Due on receipt for small jobs and Net 30 for larger customers. Pick terms that match your cash needs and put them in your quote.
Related
- Late fees and interestLate fees on invoices: can you charge interest?
- What an invoice needsWhat to include on an invoice (U.S. checklist)
- Deposit invoicesDeposit and progress invoices: how they work
- Step-by-step guideHow to create an invoice in 10 steps
This page is general information as of October 2026. Rules differ by state and industry; check your situation with a tax professional or your state’s revenue department.