Payment Terms are essential for automating your supplier payment schedules and ensuring consistent Due dates for Sales Invoices. This guide covers everything you need to know about creating, managing, and using Payment Terms effectively.

Tutorial Video

Setting Payment Terms per customer

Manage Payment Terms

When you assign a Payment Term to a supplier or customer, the system automatically applies the agreed-upon payment schedule to transactions subsequently created for them.

Add a Payment Term

To create a new Payment Term:

From the main menu, go to Settings > System > Payment Terms.
In the "Name" field, enter a unique name for the term.
In the "Days" field, enter the number of days that will be used in the term's calculation.
Use the "Type" drop-down menu to select one of the following methods that the Days calculation will apply to:
- Days after
- Days following the end of the month
- Days of the month following
- End of the month following
Click Add.

Payment Term Types

The four payment term types available outline how the number of days entered will apply to the Sales Order's Invoices to determine their Due Dates, or your agreed-upon payment schedule for suppliers.

Payment Term Type	Description
Days after	Payment is due a specified number of days after the Order Date (Purchase Order) or Invoice Date (Invoice).
Days following the end of the month	Payment is due a specified number of days after the Order Date (Purchase Order) or Invoice Date (Invoice) month ends.
Days of the month following	Payment is due on a specific date of the month after the Order Date (Purchase Order) or Invoice Date (Invoice).
End of the month following	Payment is due on the last day of the month after the Order Date (Purchase Order) or Invoice Date (Invoice) month ends.

Edit a Payment Term

Payment Terms can be edited at any time, after they've been created:

From the main menu, go to Settings > System > Payment Terms.
Click on the Payment Term row you want to edit.
Update the Name, Days, or Type fields as needed.
Click away from the term to save.

Changes to a Payment Term will only apply to new transactions created after the update. Existing Sales Invoices retain their original dates.

Obsolete a Payment Term

When a Payment Term has been previously used in transactions but is no longer needed and is not currently assigned to a customer or supplier record (including obsolete records), it can be made obsolete:

From the main menu, go to Settings > System > Payment Terms.
Along the payment term's row, tick the obsolete checkbox.

When obsolete, the Payment Term will no longer be available to select in customer and supplier records, but will be preserved in historic transactions.

Delete a Payment Term

For Payment Terms that haven't been used in completed transactions and are not assigned to a customer or supplier record (including obsolete records), they can be deleted:

From the main menu, go to Settings > System > Payment Terms.
Click the bin icon in the Delete column.

If a Payment Term has been used in any completed transaction, the delete option won't be available; use the Obsolete function instead.

Using Payment Terms

After a Payment Term has been created, and provided it is not obsolete, it can either be assigned on a per-Invoice basis for Sales, or it can be assigned to a customer to automatically calculate the order's due dates for subsequent transactions. They can also be assigned to a supplier for record-keeping.

Customer Payment Terms

Payment Terms streamline your accounts payable and receivable processes by automatically calculating important dates based on your business agreements. Set them up once at the customer level, and let the system handle the date calculations for all future transactions.

To assign a payment term to a customer:

Open the customer record.
Go to the Details tab.
Use the "Payment Term" drop-down menu to select the appropriate term.
Click Save.

From then on, new Sales Orders created for the customer will use the selected Payment Term to calculate the Invoice's Due Date based on its Sales Order's Order Date.

Payment Terms in Invoices

When a Payment Term has been assigned to a customer, their Invoices' Due Dates will be calculated from the Invoice Date using the selected Payment Terms. But when a Payment Term has not been assigned to a customer's record, the Due Date in Invoices created for their Sales Orders will match its current Invoice Date.

Whilst an Invoice is in Parked status, you can use its Payment Term drop-down menu to update the current term and calculate a new Due Date from the current Invoice Date. Changes made to the Invoice Date will automatically update the Due Date in line with the selected Payment Term.