What does Net 30 mean? Payment terms explained (with 2/10 Net 30)
Net 30 means the client has 30 days from the invoice date to pay. Here's how Net 30, Net 15, due on receipt and 2/10 Net 30 work, and how to pick the right terms.
Net 30 means your client has 30 days from the invoice date to pay the full amount. If you send an invoice on March 1 with Net 30 terms, payment is due on March 31.
It's the most common payment term in business-to-business work, but it isn't always the best choice for a small business. Here's how the common terms work and how to choose.
The common payment terms
| Term | What it means |
|---|---|
| Due on receipt | Pay as soon as the invoice arrives. |
| Net 7 / Net 10 / Net 15 | Pay within 7, 10 or 15 days of the invoice date. |
| Net 30 | Pay within 30 days of the invoice date. |
| Net 60 / Net 90 | Pay within 60 or 90 days. Common with large companies. |
| EOM (end of month) | Pay by the end of the month the invoice was issued. |
| 2/10 Net 30 | Take 2% off if you pay within 10 days; otherwise the full amount is due in 30. |
The "Net" in Net 30 refers to the net amount: the total after any discounts or credits already applied.
What is 2/10 Net 30?
2/10 Net 30 is an early-payment discount. The client can take 2% off the invoice if they pay within 10 days. If they don't, the full amount is due within 30 days.
On a $2,000 invoice:
- Paid by day 10: the client pays $1,960.
- Paid between day 11 and day 30: the client pays $2,000.
Is it worth offering? Giving up 2% to be paid 20 days sooner is expensive in annual terms, so only offer it when getting cash sooner really matters to you, or when a client is known to pay slowly and you want to give them a reason to move faster.
When does the 30 days start?
Normally on the invoice date, not the date the work finished and not the date the client opened the email. That's why it matters to send the invoice as soon as the job is done. Every day you wait to invoice is a day added to how long you wait for money.
Write the actual due date on the invoice as well as the term ("Net 30, due April 14"). Clients pay by the date they see, not by the math they'd have to do.
Which terms should a small business use?
- Freelancers and service businesses working for individuals: due on receipt or Net 7. Consumers don't expect 30-day terms.
- Contractors and trades: take a deposit up front, then Net 7 or Net 15 on the balance.
- Selling to other businesses: Net 15 or Net 30 is normal. Large companies may require Net 60 in their vendor agreements; decide before you sign whether you can carry that.
- New clients: shorter terms until they've paid you on time once or twice.
Shorter terms get you paid faster. There's no rule that says you must offer 30 days just because it's common.
What happens when Net 30 passes?
The invoice becomes overdue. Have a simple follow-up routine ready: a friendly reminder a few days before the due date, another on the due date, and firmer ones after. We wrote a full guide with templates: how to follow up on an unpaid invoice.
If your contract allows it, you can also charge a late fee. State it on the invoice ahead of time (for example, "1.5% per month on balances past due"), and check what your state allows.
Set your terms once in Invoicefy
In Invoicefy you pick a due date on every invoice, and we show your client the exact date on their invoice page. Automatic reminders go out before and after the due date so you don't have to chase. Clients can pay online by card or PayPal from the link you send.