What are terms?

Terms show when you expect to receive payment from a customer or when your suppliers expect payment from you.

For example, "Due on receipt" means payment is due immediately.

You can use terms to automatically calculate the Due Date on an invoice or bill

• By default, the Invoice Date or Bill Date is the date you created the invoice or bill.
• QuickBooks adds the terms to the Invoice Date> or Bill Date to calculate the Due Date.

Terms names

When you create a new company, a list of frequently-used terms are added to the Terms List.

• Due on receipt - Payment is due immediately.
• Net 15 - Payment is due in 15 days.
• Net 30 - Payment is due in 30 days.
• Net 60 - Payment is due in 60 days.

When a terms name contains the word "Net," it indicates when the payment is due. For example, if you expect payment from a customer within 30 days of the Invoice Date, the terms are named Net 30.

These terms are all based on payment due in a fixed number of days. You can also create terms that require payment on a particular date of the month.

Use terms

To apply terms to a particular transaction, select the terms you want from the Terms dropdown on either the Invoice or Bill screens. When you select terms on an invoice or bill, the Due Date automatically changes to reflect the terms you chose.

You can also set up default terms for particular customers or suppliers. Finally, you can set up default terms for all invoices or all bills .

See also

Add terms