Payment Term
A payment term says when the customer pays: everything 30 days after the invoice, or 40% now and the balance in 60 days. Each customer invoice takes its due date and its payment schedule from its payment term.
What it is for
The term is set on the customer and copied to each invoice. On a Customer Invoice, the Due Date is the Baseline Date plus the Days of the term's first line. When the invoice is saved, its payment schedule is built from the lines: one schedule line per condition, each due on the Baseline Date plus the days of that line and every line before it. A Collection then clears the invoice schedule line by schedule line.
Every field in plain words
General
| Field | What it means | What to put |
|---|---|---|
| Payment Term | The term's code | Required. Must be unique in the company |
| Name | What the term is called | Required. "Net 30 days", "40% advance, balance 60 days" |
| Predefined | Delivered with the system | Read-only. A predefined term cannot be deleted |
| Block | The term can no longer be picked | Tick to retire it |
Basic Data
At least one line is required.
| Column | What it means | What to put |
|---|---|---|
| Due Condition | How much of the invoice this line covers | A percentage of the invoice, a fixed amount, or the balance (what is left) |
| Value | The percentage or the amount | Locked on a balance line |
| Days | Days after the line before it that this part falls due | The first line may be 0 (payable at once). Every later line must be more than 0 |
Terms & Conditions
| Field | What it means |
|---|---|
| Terms Notes | Free text kept with the term |
The rules a term must meet
- Percentages may not add up to more than 100.
- If there is no balance line and no fixed-amount line, the percentages must add up to exactly 100.
- Percentage lines that add up to less than 100, or any fixed-amount line, need a balance line.
- Only one balance line, and it must be the last line.
How to configure it
Make one term per commercial agreement you actually use. Keep the first line's Days equal to the days you want printed as the invoice's due date, because the due date is worked out from the first line only.
A fixed-amount line passes the checks on this screen, but a customer invoice that uses the term is refused with "Payment Term ... is not defined correctly. Schedule is not calculated". Use percentage and balance lines only.
Scenarios
- Net 30. One line: percentage 100, Days 30.
- Cash on delivery. One line: percentage 100, Days 0.
- 40% advance, balance in 60 days. Line 1: percentage 40, Days 0. Line 2: balance, Days 60.
- Three equal instalments a month apart. Line 1: percentage 33.33, Days 30. Line 2: percentage 33.33, Days 30. Line 3: balance, Days 30. The schedule falls due at 30, 60 and 90 days.
What it is connected to
- Customer In Legal Entity and Customer Group carry the default term.
- Customer Invoice and Customer Invoice Memo use it for the due date and the schedule.
- Collection clears the schedule lines.
If something looks wrong
- "Payment Term cannot be empty" / "Name cannot be empty" / "Basic Data cannot be empty". Fill the code, the name and at least one line.
- "The maximum percentage for the totals cannot exceed 100". Lower the percentages.
- "Either Total percentage should be 100 OR Add Balance Due Condition". Make the percentages add to 100, or add a balance line.
- "Balance must be add in due condition". Add a balance line at the end.
- "Balance can only be set once" / "Line ID: ...: Balance should be on the last line." Keep one balance line, last.
- "Line ID: ... - Days must be greater than zero". Only the first line may have 0 days.
- "Payment Term Cannot be Duplicate". The code exists in this company.
- "Payment Term - cannot delete this Payment Term as it's predefined". Block it instead.
- The invoice's due date ignores my second line. By design the Due Date shows the first line only; the full schedule is in the invoice's payment schedule.