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The short version
- Net 30 means the full amount is due 30 days after the invoice date.
- Shorter terms mean you are owed less money at any moment. Net 14 cuts it roughly in half compared with net 30.
- Agree the terms before the work starts, and print the due date on the invoice as a real date.
- Homeowners can usually pay on receipt; larger companies often set their own terms, so ask before you quote.
What net 30 means
"Net" means the full amount, with nothing taken off. "Net 30" is short for: the full amount of this invoice is due within 30 days of the invoice date. Days are usually counted as calendar days, weekends and holidays included. If you mean business days, write it out.
Worked example
An invoice dated November 17, 2026 on net 30
- Invoice date
- Nov 17, 2026
- Days left in November (18 to 30)
- 13 days
- Days needed in December
- 17 days
- Due date
- Dec 17, 2026
Count from the day after the invoice date. Print "Due Dec 17, 2026" on the invoice so nobody has to count.
Common payment terms
| Term | What it means | Often used for |
|---|---|---|
| Due on receipt | Pay when the invoice arrives. | Homeowners, one visit jobs, deposits |
| Net 7 | Due 7 days after the invoice date. | Small jobs, repeat residential clients |
| Net 14 | Due 14 days after the invoice date. | Small business clients |
| Net 30 | Due 30 days after the invoice date. | Companies with a monthly payment run |
| Net 60 | Due 60 days after the invoice date. | Large companies that set their own terms |
| EOM | Due at the end of the month the invoice is dated in. | Clients who pay once a month |
| 2/10 net 30 | 2% off if paid within 10 days, otherwise the full amount in 30. | Larger invoices where cash sooner is worth a discount |
Whatever you pick, put it in your estimate or contract first, then repeat it on the invoice. A term the client never agreed to is hard to hold them to.
Why shorter terms are worth asking for
Your terms decide how much of your own money is sitting with clients at any moment. If you bill about the same amount every month and clients pay on the due date, you are always owed roughly your monthly billing times the term divided by 30.
Worked example
A business billing $8,000 a month
- Owed at any moment on net 30
- $8,000.00
- Owed at any moment on net 14 ($8,000 × 14 ÷ 30)
- $3,733.33
- Cash freed up by switching
- $4,266.67
That freed up cash is money you no longer have to cover from savings or credit while you wait. Real clients pay early and late, so treat this as a rough guide.
Clients pay on time more often when the due date is near and clear. A due date three weeks away gets put off; one next week gets paid.
Early payment discounts: 2/10 net 30
"2/10 net 30" offers 2% off when the client pays within 10 days, with the full amount due in 30. It can speed up payment from clients who have the cash, but it costs more than it looks.
Worked example
A $2,400 invoice on 2/10 net 30
- Paid by day 10: discount (2% of $2,400)
- $48.00
- Client pays by day 10
- $2,352.00
- Days you get paid sooner (30 − 10)
- 20 days
- Yearly cost of the discount (2 ÷ 98 × 365 ÷ 20)
- about 37%
Giving up 2% to be paid 20 days sooner is like borrowing at about 37% a year. Offer it only if you need the cash more than the margin.
How to choose your terms
- Homeowners and one off clients: due on receipt or net 7. Many expect to pay when the job is done.
- Small business clients: net 14 is a fair middle ground.
- Larger companies: ask about their payment run before you quote. Many pay on fixed terms like net 30 or net 60 whatever your invoice says, so price that wait into the job.
- Big or long jobs: do not wait for one invoice at the end. Take a deposit and bill in stages; see how to ask for a deposit.
- Retainers and regular work: bill at the start of each period, due on receipt or net 7.
When the law sets the term
Some work comes with terms set by law. In Ontario construction, the Construction Act requires an owner to pay a proper invoice within 28 days of receiving it, unless they give notice of non payment, and federal construction work has a similar 28 day rule. US federal agencies generally pay 30 days after receiving a proper invoice under the Prompt Payment Act, and usually owe interest when they pay late. Check the rules that apply to your work and province or state.
Payment terms in Sumocat
In Sumocat you set your usual terms once: on receipt, 7, 14 or 30 days, or any number up to 365. You can give a client their own terms, and every new invoice for them starts with those, so the due date fills in by itself. All of this is free.
When the due date comes, Sumocat Pro PRO can send payment reminders on the due date and 3, 7 and 14 days after, until the invoice is paid. If a payment is late, read how to charge late fees and work out the amount with the late fee calculator.
Put your terms on a real invoice
Pick your terms in the free invoice generator and the due date is worked out for you.
Questions
Does net 30 include weekends?
Usually yes. Net terms are normally counted in calendar days. If you mean business days, say so in your terms, and print the due date on the invoice either way.
Does net 30 start from the invoice date or the day the client gets it?
Normally the invoice date. Some large clients count from the day they receive it or approve it. If that matters, agree it in writing before the work starts.
What does "due on receipt" mean?
The invoice is due as soon as the client receives it. In practice most clients pay within a few days, so follow up if a week goes by.
Can I change my payment terms for an existing client?
Yes, for future work. Tell the client before their next job and put the new terms on the next estimate. Do not change terms on an invoice you have already sent.
Sources
The official pages this guide relies on, with the date we last checked each one. Rules and rates change, so check the page itself before you rely on it.
- Ontario e-Laws, Construction Act, R.S.O. 1990, c. C.30. www.ontario.ca/laws/docs/90c30_e.doc Checked .
- Justice Laws Website, Federal Prompt Payment for Construction Work Act. laws-lois.justice.gc.ca/eng/acts/F-7.7/page-1.html Checked .
- Bureau of the Fiscal Service, US Treasury, Prompt Payment: frequently asked questions. fiscal.treasury.gov/payments-from-government/prompt-payment/faqs Checked .