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Payment Terms

A payment term says how many days a customer or vendor has to pay: Due on Receipt is 0 days, Net 30 is 30. DayZero uses terms to fill in due dates on new invoices and bills, and records on each document which term its due date came from.

Availability

The Payment Terms page is switched off in DayZero for now:

  • It is not in the Books sidebar, and a link to it opens Books instead.
  • New invoice and bill forms don't show a term picker.
  • Regent can't list, create or change payment terms.
  • A new business starts with no terms.

Terms a business already has keep working, for example terms imported from QuickBooks or created through the Payment Terms API. The rest of this article describes that behaviour.

How due dates are worked out

Document Term used, in order Days counted from
Invoice The customer's Default Payment Terms, then the business default term, then 30 days The Date of Issue (today if blank)
Bill entered by hand The vendor's Default Payment Terms, then the business default term The invoice date for a received bill, today for a draft
Bill from email or upload With Date received: the vendor's default term, then the terms on the vendor's invoice, then the business default term. With Invoice date: the due date printed on the invoice The date the bill arrived
Purchase order The vendor's default term —

The due date fills in once you pick the customer or vendor. Typing a due date yourself always wins. Payment terms count from (Invoice date or Date received) is set under Approval Policies and applies to bills that arrive after you change it.

The term recorded on a document

When a new invoice or bill gets its due date from a term, that term is saved on the document. If you type the due date yourself, no term is saved, so the document is never counted under a term it wasn't issued on. Recurring invoices date themselves from their schedule and record no term.

Changing a term's days later only affects documents created afterwards. Issued invoices and entered bills keep their due date.

Early-payment discounts

A term can carry an early-payment discount, such as the 2% within 10 days of 2/10 Net 30. It is for planning only:

  • The Pay plan tab on Bills shows bills recorded under a discount term with what paying early saves (for example "Pay by Oct 12 to save $40.00 (2% early-pay discount)"), while the discount is still open and the bill has no payments or credits.
  • Payment suggestions and the reorder cash planner can also use it.

DayZero never takes the discount off an invoice or bill total, or off what is charged or booked. If you take a vendor's discount, record the payment for the amount you actually paid.

Accounting impact

Payment terms post no journal entries. The due dates they set feed AR and AP aging, reminders, the Pay plan and the cash-flow forecast.

Edge cases

  • Day counts are 0 or more; Due on Receipt is 0 days.
  • Only one term per business can be the default; making another term the default clears the old one.
  • Deactivating a term also clears its default flag. Documents that already carry the term keep it.
  • A deactivated term no longer appears in customer and vendor Default Payment Terms lists.

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