Invoice payment terms: what net 30, 2/10 and EOM mean

Invoice payment terms are the rules that say when and how a client must pay. Common ones are due on receipt, net 15, net 30 and net 60. Net 30 means the full amount is due 30 days after the invoice date. Shorter terms bring your cash in sooner, and longer terms often make larger clients more comfortable.

Why payment terms matter

Terms decide how long you finance your client’s purchase. If you invoice 3,000.00 USD on net 60 terms, you have done the work, paid your own costs and now wait two months. If you had asked for net 15, you would have the money in half a month. Across a year of invoices, that gap can decide whether you can cover rent and payroll on time.

Terms also shape the relationship. Clear terms tell the client what to expect. Vague terms invite the client to choose their own date, and their date is rarely the earliest one. Setting terms is one of the few parts of getting paid that you control completely before the work even begins.

The common payment terms, decoded

Term	What it means	Example (invoice dated 3 November 2026)
Due on receipt	Payment is due as soon as the client receives the invoice	Due 3 November
Net 7	Due 7 days after the invoice date	Due 10 November
Net 15	Due 15 days after the invoice date	Due 18 November
Net 30	Due 30 days after the invoice date	Due 3 December
Net 45	Due 45 days after the invoice date	Due 18 December
Net 60	Due 60 days after the invoice date	Due 2 January 2027
EOM or Net 30 EOM	The count starts at the end of the invoice month	Due about 30 December
2/10 net 30	2 percent discount if paid within 10 days, otherwise full amount in 30 days	Discount until 13 November, full amount due 3 December
Deposit, then balance	Part up front, the rest on a date or milestone	50 percent at signing, 50 percent on delivery
Cash in advance	Payment before work or delivery	Paid before work starts

“Net” refers to the net amount, meaning the invoice total with nothing deducted, unless an early-payment discount applies. The number is almost always days, counted from the invoice date, unless your agreement says otherwise. Some contracts count from the day the client receives the invoice or from the delivery date, so say which you mean.

How early-payment discounts work

The notation 2/10 net 30 has three parts. The 2 is the percent discount, the 10 is the number of days the discount lasts, and “net 30” is the final due date for the full amount.

Use discounts sparingly and be explicit. State the cutoff date on the invoice, not just the notation, and decide in advance what you will do when a client takes the discount late. Many businesses simply enforce the date.

How to choose payment terms

There is no single right answer. Match the term to the client and the job.

• New client or small job (under a few hundred dollars): due on receipt or net 7. You have no payment history yet, and the amounts do not justify long waits.
• Consumers and one-off jobs: due on receipt, or a deposit plus a balance when the work is finished.
• Regular small-business clients: net 15 is a fair middle ground. It is long enough to run through an approval step and short enough to protect your cash.
• Larger companies: expect net 30, 45 or 60. Many have set payment cycles. Ask what they are, and if they insist on net 60, consider a higher deposit or a slightly higher price.
• Large or risky projects: use deposits and milestone invoices so you never carry too much unpaid work at once.
• Clients with a poor history: shorten the term, ask for payment in advance, or stop work until the invoice is settled, if your contract allows.

Ask yourself three questions: how well do I know this client, how much money is at stake, and how long can I afford to wait? The answers usually point to the term.

How to write terms on an invoice

Put the terms where the client will see them, usually near the due date and the total.

A model line reads: “Payment terms: Net 15. Due 18 November 2026. Late payments may incur a fee of 1.5% per month as agreed in the project contract.” Adjust the wording to your own agreement, and check local rules before relying on a late fee.

A worked example: choosing and dating terms

A web developer, Priya Nair, takes on a new client for a 6,000.00 USD site. She does not know their payment habits. She chooses a deposit-and-balance structure with net 15 on the balance.

By splitting the project, Priya has already been paid half before delivering anything. Even if the balance runs late, her exposure is limited.

Legal points to keep in mind

Payment terms are mainly a matter of agreement between you and your client. The agreement is what you rely on if there is a dispute, so write it down. Beyond that, some places set rules on late payment. In the UK, for example, the government says the statutory interest rate on late commercial payments is 8 percent plus the Bank of England base rate for business-to-business transactions, unless the contract sets a different rate. In the US, rules about late fees and interest vary by state and by the terms you have agreed. Rules also differ for consumers and businesses, and for public bodies.

None of this replaces advice. If you sign large contracts or work across borders, ask a lawyer or an accountant to review your standard terms once. It is a small cost compared with a dispute later.

Common mistakes with payment terms

• Leaving terms off the invoice. The client fills the gap with their own assumption.
• Writing only “Net 30.” Add the date. Clients and software may count from different starting points.
• Offering long terms to everyone. Long terms are a favor, not a default. Reserve them for clients who have earned them.
• Giving a discount without a cutoff date. Clients will take it late.
• Changing terms mid-project without telling anyone. Agree changes in writing before they apply.
• Confusing EOM with net. They count from different dates. Say which one applies.
• Not following up. The best terms do nothing if you never check. Set reminders for the due date.

Checklist: setting your terms

• You have chosen terms based on client history, job size and your cash needs.
• The terms appear in your quote or contract, not just on the invoice.
• The invoice shows both the term and the exact due date.
• Any early-payment discount shows its cutoff date and the discounted amount.
• Late fees or interest appear only if your agreement allows them.
• Payment methods are listed, with one easy option first.
• You have a reminder set for a few days before the due date and the day after.

Where PayToMe fits

The due date calculator and the invoice generator are live and free today. In PayToMe, now in public beta, you can set terms on each invoice you create and send. Default terms per client, with automatic reminders based on them, are in development. To go further on cash flow, read how to get paid faster.

Sources

This is general information, not legal or tax advice. The UK statutory interest rate comes from GOV.UK: Charging interest on late commercial payments. The meaning of net terms, EOM and 2/10 net 30, and the annualized figure for the discount, are standard commercial conventions and arithmetic worked out in the examples above, not legal rules. Check your own contract and local law before relying on any term.