Due on receipt vs 7 days vs 30: picking payment terms

You're filling in the invoice and hit the payment terms box. Seven days? Thirty? Due on receipt? There's no law that picks for you. But the number you choose sets when you can start chasing, so it's worth choosing on purpose.

What the terms actually mean

• Due on receipt: payable as soon as they get it. Best for small one-off jobs where they're expecting the bill.
• 7 days: the trade standard. Enough time for anyone to do a bank transfer, short enough that the job is still fresh in their mind.
• 14 days: a middle ground some tradies use for bigger residential jobs.
• 30 days: a corporate habit from big-company accounts departments. It means a month of you carrying their bill.

The term starts the clock. An invoice isn't overdue, and you can't reasonably chase it, until the term runs out.

What actually suits a sole trader

Short terms. The longer the term, the longer you're the bank. For most one-tradie-size jobs, due on receipt or 7 days is normal and nobody blinks at it.

The one place you'll get pushed longer is commercial work. Builders, property managers and body corporates often pay on their own cycle and will tell you it's 30 days end of month. That's a negotiation, not a law of nature. You can accept it for the volume, or price the wait in, or walk. Just decide knowingly.

Write the term so it can't be misread

"Net 7" means nothing to a homeowner. Write the actual date.

• Put "Due date: 29 July 2026" on the invoice, big and near the total.
• If you use a term, say it in plain words: "Payment due within 7 days of invoice date."
• Say how to pay right next to it: pay link, or BSB and account.

A specific date removes the only honest excuse, which is "I didn't know when it was due."

The term is a promise you have to keep too

If the invoice says 7 days, chase at day 8, not day 20. Customers learn fast whether your due dates mean anything. A polite nudge the day after it falls due does more for your cash flow than any wording on the invoice.

Set the term, state the date, follow it up. That's the whole system.