What is Net 30 payment terms?
What is Net 30 payment terms and how does it work?
Short answer
**Net 30** means the full invoice amount is due within 30 calendar days from the invoice date. It is the most common B2B payment term in the United States.
**How the timeline works:** - Invoice date: Day 0 - Payment due: Day 30 - Invoice becomes past-due: Day 31 - Late fees (if specified): accrue from Day 31 onward
**Variants you'll encounter:** - **Net 15** — 15-day terms, common in professional services - **Net 60 / Net 90** — longer terms, common in manufacturing and government contracts - **2/10 Net 30** — 2% discount if paid within 10 days, otherwise full amount due by day 30 - **Due on receipt** — payment expected immediately (common for one-off retail/service)
**When to use Net 30:** - Established clients with a payment history - B2B transactions where the client requests terms - Industries with standard Net 30 expectations (wholesale, construction, professional services)
**When NOT to use Net 30:** - New clients with no history — require 50% upfront or shorter terms - Small jobs under $500 — due-on-receipt or credit card upfront is more efficient - Clients who have been late before — tighten terms or require prepayment
**Enforcing Net 30:** State your late fee on every invoice (e.g., "1.5% per month on balances unpaid after 30 days"). Begin reminder emails at Day 27 so the payment is top-of-mind before the due date. The most common reason for late payment is that the client simply forgot — automated reminders starting 3 days before due date cut overdue rates significantly.