Payment Terms
Payment Terms define when payment is due for invoices. They can specify due dates, installment schedules, and early payment discounts.
Creating Payment Terms
- Go to Accounting > Payment Terms Template and click New.
- Enter a Template Name (e.g., "Net 30", "50% Advance 50% on Delivery").
- Check Default if this should be the default for new customers/suppliers.
- Add terms in the Payment Terms table:
- Payment Term: Description (e.g., "50% Advance")
- Due Date Based On: When the due date is calculated from
- Invoice Portion: What percentage of the invoice this term applies to
- Credit Days: Number of days after the base date when payment is due
- Credit Months: Alternative to Credit Days for monthly terms
- Click Save.
Common Payment Terms
| Template | Description |
|---|---|
| Net 30 | Full payment due 30 days from invoice date |
| Net 60 | Full payment due 60 days from invoice date |
| Due on Receipt | Payment due immediately |
| 50% Advance, 50% on Delivery | Half upfront, half at delivery |
| End of Following Month | Due at the end of the month after invoice |
Applying Payment Terms
Payment Terms can be set at:
- Customer / Supplier Master: Default payment terms for all transactions with this party
- Transaction Level: Override the default on individual Sales Orders or Purchase Orders
- Company Default: Set in the Company master
Early Payment Discount
You can configure early payment discounts on payment terms. For example, "2% discount if paid within 10 days" would be set as a separate payment term row with a discount percentage.