What does net 30 mean on an invoice?
Net 30 is a payment term. It means the customer has 30 days from the invoice date to pay the full amount. It is one of the most common terms in business billing.
How net 30 works
The clock starts on the invoice date, not the day the customer receives it. An invoice dated October 1 with net 30 terms is due October 31. Put the due date on the invoice as well as the term so there is no confusion.
Other common terms
- Due on receipt: payment is expected right away
- Net 15 and net 45: 15 and 45 days to pay
- Net 60: common with large companies
- 2/10 net 30: a 2 percent discount if paid within 10 days, otherwise the full amount in 30
Choosing a term
Shorter terms improve your cash flow. Longer terms can win larger customers. Small businesses often use net 15 or due on receipt and agree longer terms only when a customer asks.
Where to write it
Put the term near the total, for example: Payment terms: Net 30. Due October 31. Add your late fee policy next to it if you have one.
Questions
Does net 30 mean 30 business days?
No. It means 30 calendar days unless the agreement says otherwise.
Can I offer net 30 to some customers only?
Yes. Many businesses give longer terms to established customers and ask new ones to pay sooner.
Free tool: Invoice Due Date Calculator
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General information, not legal, tax, or accounting advice. Rules vary by place.