Payment terms define when your invoice is due and how payment should be made. They set expectations, protect your cash flow, and give you legal ground to stand on if a client pays late.
Common Payment Terms
- Net 30 - Payment due 30 days after invoice date
- Net 15 - Payment due 15 days after invoice date
- Net 7 - Payment due 7 days after invoice date
- Due on receipt - Payment due immediately upon receiving invoice
- 2/10 Net 30 - 2% discount if paid within 10 days, otherwise due in 30
"Net 30" is standard for B2B in Europe, but freelancers often push for shorter terms like Net 15 or Net 7 to improve cash flow.
Why Payment Terms Matter
Without clear terms, clients interpret "due date" however they want. You think it's due in two weeks, they assume 60 days is fine.
Clear payment terms:
- Set expectations - Client knows exactly when to pay
- Protect cash flow - Shorter terms mean faster payment
- Enable enforcement - Legal basis for late fees or compensation
- Reduce disputes - No ambiguity about due dates
EU Late Payment Rules
In the EU, the Late Payment Directive (2011/7/EU) sets a legal maximum of 30 days for most B2B payments. If your invoice says Net 60, the law still protects the client. If it says Net 15, you can claim compensation after 15 days.
This is why understanding payment terms isn't just business practice—it's legal protection.
Setting Your Payment Terms
Consider:
- Your cash flow needs - Can you afford to wait 30 days?
- Industry standards - What do competitors use?
- Client size - Large companies often demand Net 30+
- Your leverage - In-demand freelancers can negotiate shorter terms
Don't be afraid to ask for Net 7 or Due on Receipt for small projects. The worst they can say is no.
Payment Methods
Your terms should also specify how clients can pay:
- Bank transfer (most common in EU)
- Credit card
- PayPal or payment processor
- Check (rare in EU)
Include your bank details or payment link directly on the invoice to remove friction.
Chronobill lets you set default payment terms per client, auto-calculates due dates, and includes payment instructions on every invoice—so clients know exactly what's expected.