Freelance invoice payment terms: net 15, net 30, deposits and late fees

The short answer

Payment terms say when the invoice must be paid and what happens if it is not. For most freelance work, 14 days from the invoice date is a fair default for small clients, 30 days is normal for larger companies, and a deposit before work starts is normal for any project over a few days. Put the terms in the quote or contract first, then repeat them on every invoice with an actual due date.

The common terms, decoded

"Net" here just means the full invoice amount. The number counts calendar days from the invoice date, unless your terms say otherwise. If you want the clock to start from delivery or from the client receiving the invoice, write that out, because people will assume the version that suits them.

Which terms to choose

Shorter is not always better. A term the client's accounts team cannot meet does not get you paid faster; it gets you an overdue invoice and an awkward conversation. Ask the client how their payment runs work before you agree. Many companies pay suppliers once or twice a month on fixed days, and an invoice that misses a run waits for the next one.

What I would use:

• Individuals and very small businesses: 7 to 14 days, or payment on delivery for small jobs.
• Small and mid-size companies: 14 to 30 days.
• Large corporations: 30 days if you can get it, and expect their standard terms to be longer. Agree the term in writing before the project, because their purchasing system will apply its default otherwise.
• New clients you know nothing about: a deposit, and shorter terms for the balance.
• Retainers: invoice at the start of each month, due within 7 to 14 days, for that month's work.

Whatever you pick, write the actual date on the invoice: "Due 19 October 2026 (14 days)". A date leaves nothing to interpret.

Deposits, milestones and retainers

For anything longer than a week or two, waiting until the end to invoice everything puts all the risk on you. Three ways to share it:

A deposit is paid before work starts, commonly 25 to 50% of the quote. It confirms the client is serious, pays for your time if the project is cancelled early, and filters out clients who were never going to pay. Say in the quote whether it is refundable. Invoice the deposit as its own invoice with its own number (see the deposit invoice guide), and reference it on the final invoice: "Total 4,950.00, less deposit paid (invoice 2026-011) 1,485.00, balance due 3,465.00".

Milestone billing splits the project into stages, each with a payment: for example 30% to start, 40% on approval of the first draft, 30% on final delivery. Tie each milestone to something both sides can see happen, like "approval of the drafts", not "halfway through".

A retainer is a fixed monthly fee for an agreed amount of time or a standing set of tasks, paid in advance. It suits ongoing work. Say in writing what happens to unused hours (most retainers do not roll them over) and how extra hours are billed.

Early payment discounts

"2/10 Net 30" offers a discount for paying fast. In theory it speeds payment up. In practice, small clients often ignore it and large ones sometimes take the discount even when they pay late, which means you then chase a 2% difference. If you want to try it, make sure your invoice shows both amounts and both dates, so there is no argument about which applies.

For most freelancers a clear due date and a reminder on time does more than a discount.

Late fees and interest

You can only charge a late fee or interest if the client agreed to it, or if the law gives you the right regardless of what was agreed. Either way, state it on the quote, in the contract and on the invoice. A fee that appears for the first time in a reminder is hard to enforce and harms the relationship.

What the law says in some places:

• United Kingdom. For business-to-business debts, the Late Payment of Commercial Debts (Interest) Act 1998 lets you claim statutory interest at 8% a year above the Bank of England base rate, plus fixed compensation per invoice: £40 for debts under £1,000, £70 for £1,000 to £9,999.99, and £100 for £10,000 or more. It applies unless your contract sets its own substantial remedy. A Commercial Payments Bill, still going through Parliament in October 2026, would cap payment terms at 60 days and make this interest mandatory; GOV.UK will say when it is in force.
• European Union. The Late Payment Directive (2011/7/EU) gives businesses a right to interest of at least 8 percentage points above the European Central Bank reference rate, plus at least €40 in compensation for recovery costs. Where no payment period was agreed, interest generally runs from 30 days after the client receives the invoice. Each country writes this into its own law; Germany, for example, sets the rate for business debts at 9 points above its base rate.
• United States. There is no federal rule for late fees between businesses. It is a matter of contract and state law, and many states cap interest rates. A few places have freelancer payment laws: New York City, New York State, Illinois and California require a written contract above a set amount (from $250 in California to $800 in New York) and, where no payment date is agreed, payment within 30 days of finishing the work. Check the rules for your state and the client's.
• Canada and Australia. Late interest between businesses depends on your contract and on provincial or state law. Write the rate into your terms.

Even where you have the right, think about whether to use it. Adding statutory interest to a long-standing client's first late invoice can end a good relationship over a small sum. It is a tool for clients who are repeatedly late or who have stopped replying. Many freelancers mention it on the invoice and only claim it when a debt goes past 30 days. The late payment interest calculator works out the sum for the UK, the EU, Germany or your own contract rate.

Wording you can copy

Short, specific, and the same everywhere the client sees it:

Payment terms: 14 days from the invoice date. This invoice is due
on 19 October 2026.

Please pay by bank transfer using the invoice number as the reference.
All bank charges are at the sender's cost.

Late payment: overdue invoices accrue interest at [rate] per month
[or: statutory interest under the Late Payment of Commercial Debts
(Interest) Act 1998], from the due date until payment.

For a project with a deposit:

Payment schedule: 40% deposit due before work starts (invoiced on
acceptance of this quote), 60% balance due 14 days after final
delivery. Work starts once the deposit is received.

Replace the bracketed parts with your own figures. If you use contractual interest instead of statutory, keep the rate reasonable and check that it is within any legal cap where you or the client are.

Make the terms stick

Terms only work if they are agreed before the work and applied the same way every time:

1. Put them in the quote and the contract, and ask for written acceptance.
2. Repeat them on every invoice, with a real due date.
3. Send the invoice the day the work or milestone is accepted.
4. Send a friendly reminder a few days before the due date for larger amounts, and a firm one the day after it passes.
5. Pause work on unpaid projects once an invoice is well overdue, and say so in writing before you do.

The payment reminder email generator drafts the reminders for each stage. My guide on how to follow up on an unpaid invoice has the full sequence with templates. To draft your terms into a contract, the contract checklists list the payment clause next to the others a freelance contract needs.

Questions