Net 30
Net 30 is a payment term indicating that the full invoice amount is due within 30 calendar days of the invoice date. It is one of the most common payment terms in business-to-business transactions and freelance contracts. The "net" refers to the total amount owed after any applicable discounts or deductions. Variations include Net 15, Net 45, and Net 60, each specifying a different payment window. Some invoices combine a discount incentive with net terms, such as "2/10 Net 30," meaning the client receives a 2% discount if they pay within 10 days, with the full amount due in 30. Net 30 terms are standard in industries where work is completed before payment, including consulting, creative services, and professional services. While Net 30 provides the client with cash flow flexibility, it requires the service provider to finance the gap between completing work and receiving payment. Freelancers and small businesses should evaluate whether they can absorb this delay and consider requiring deposits or milestone payments alongside net terms.
Example
A graphic designer invoices a corporate client $3,500 for a completed brand package with Net 30 terms, meaning the payment is due within 30 days of the invoice date.
Frequently asked questions
- What does 2/10 Net 30 mean?
- It means the client can take a 2% discount if they pay within 10 days, otherwise the full amount is due within 30 days. This structure incentivizes early payment while still providing the standard 30-day window. It is common in wholesale and manufacturing but less typical in freelance services.
- What should you do if a client does not pay within the Net 30 window?
- Send a payment reminder on or shortly after day 30. If the invoice remains unpaid, follow up with a formal past-due notice. Many contracts include a late payment clause that charges interest or a flat fee on overdue invoices. Having this clause in writing makes enforcement significantly easier.
- Is Net 30 good for freelancers?
- It depends on your cash flow situation. Net 30 is standard and expected by many clients, but waiting 30 days (or longer, if the client pays late) can strain a freelancer's finances. Combining Net 30 with an upfront deposit or milestone payments reduces the risk of financing too much work before getting paid.