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Net 7 vs Net 30: Understanding Invoice Payment Terms

By InvoiceFree.info ·February 18, 2025 ·🕒 4 min read

Payment terms tell your client exactly when they need to pay. Choosing the right terms is one of the most impactful decisions you can make for your cash flow. This guide explains every common payment term, when to use each, and which ones freelancers should default to.

What Does "Net" Mean on an Invoice?

"Net" simply means the total amount due. "Net 30" means the full invoice amount is due within 30 days of the invoice date. "Net 7" means due within 7 days. The number is always the number of calendar days from the invoice date.

Complete Guide to Every Payment Term

Due on Receipt
Payment is due immediately when the client receives the invoice. Best for: small projects, new clients, digital downloads, or any work where you need payment upfront. It sets the expectation that your work is valuable and payment is not optional.
Net 7
Payment due within 7 calendar days. Ideal for most freelance work — fast enough to maintain cash flow, and still gives clients time to process payment through their accounts payable. This is the recommended default for freelancers.
Net 14
Payment due within 14 days. A good compromise for clients who need a little more time — such as small businesses with twice-monthly payment cycles. Still much faster than Net 30.
Net 30
Payment due within 30 days. Standard in corporate environments. Acceptable for large, established companies — but avoid it with small businesses or new clients where cash flow matters more. Net 30 means waiting over a month for money you've already earned.
Net 60
Payment due within 60 days. Common in large enterprise contracts. As a freelancer, only accept Net 60 if the project is large, the client is a well-known company, and you can afford to wait. Always charge more to compensate for the cash flow delay.
2/10 Net 30
The client gets a 2% discount if they pay within 10 days; otherwise the full amount is due in 30 days. A smart strategy to incentivise early payment from corporate clients who have the budget but slow internal processes.

Which Payment Terms Should Freelancers Use?

The answer depends on your client type and project size:

  • New clients, small projects: Due on Receipt or Net 7
  • Ongoing clients you trust: Net 7 or Net 14
  • Small-to-medium businesses: Net 14
  • Large corporations: Net 30 (negotiate from Net 14 if possible)
  • Enterprise accounts: Net 30 or Net 60 — always build this into your pricing
Freelancer default: always start with Net 7 Begin every client relationship with Net 7. Many clients will accept it without question. If a client pushes back, you can move to Net 14. Starting at Net 30 gives you no room to negotiate faster terms.

How to Add a Late Payment Clause

State clearly on your invoice: "Invoices unpaid after the due date are subject to a 1.5% monthly interest charge." This is legally enforceable in most countries and significantly increases on-time payment rates. Even if you never enforce it, the clause changes client behaviour.

Setting Payment Terms in InvoiceFree.info

When creating an invoice with InvoiceFree.info, you can select your payment terms from the dropdown: Due on Receipt, Net 7, Net 15, Net 30, or Net 60. The app automatically sets the due date based on your selection, and prints the terms clearly on your PDF invoice so there's no ambiguity for your client.

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