Invoice Payment Terms: Net 30, Net 15, or Due on Receipt?

Payment terms can make or break your cash flow. Here's everything you need to know about choosing the right terms for your freelance business.

What Are Payment Terms?

Payment terms specify when an invoice is due. They set expectations for both you and your client about when payment should be received.

Common Payment Terms Explained

Due on Receipt

Payment is expected immediately upon receiving the invoice. Best for small projects, new clients, or when you need immediate cash flow.

Pros: Fastest payment, no waiting

Cons: Some clients find it aggressive

Net 7

Payment due within 7 days. A good middle ground that gives clients a brief window while keeping your cash flow healthy.

Net 15

Payment due within 15 days. Popular among freelancers as it balances professionalism with reasonable cash flow.

Net 30

Payment due within 30 days. Industry standard for B2B transactions. Large companies often require this.

Warning: Net 30 can strain freelancer finances, especially for those with monthly bills.

Net 60 / Net 90

Extended terms that large corporations sometimes demand. Generally not recommended for freelancers unless the project is very large or you have strong cash reserves.

Which Terms Should You Use?

Situation	Recommended Terms
New client	Due on Receipt or Net 7
Small project (<$500)	Due on Receipt
Established client	Net 15 or Net 30
Large corporation	Net 30 (negotiate if possible)
Ongoing retainer	Due on 1st of month

Tips for Faster Payment

• Offer a 2% discount for early payment (e.g., "2/10 Net 30")
• Send invoices immediately upon project completion
• Use online payment options (PayPal, Stripe, etc.)
• Set up automated payment reminders
• Clearly display payment terms on every invoice

Conclusion

Choose payment terms that work for your business and cash flow needs. Don't be afraid to negotiate, and always include late payment fees in your contracts. The right terms help ensure you get paid on time, every time.