The payment terms are the most concrete section of a contract, but they are usually the part that is most rushed. When it is not written what the invoice will rest on, when it will be issued and within what term it will be paid, a service relationship that is running well gets stuck at the accounting stage.
Basis of the invoice
Which document the invoice will rest on is determined. The order and the delivery record form the basis. The link is made.
Matching the order number
The invoice carries the order number. The accounting side looks for the match. The field is filled in.
Invoicing period
Whether the invoice is issued per job or periodically is written down. A combined invoice reduces the workload. The preference is defined.
Periodic invoicing
A combined monthly invoice is practical for small jobs. A breakdown of items is attached. Transparency is preserved.
Breakdown of items
The invoice shows which item was applied and why. A one-line invoice cannot be audited. Detail is given.
Payment term
The term is written explicitly, and the date from which it starts is stated. A vague starting point produces argument. The field is defined.
When the term starts
Whether the period starts from the invoice date or from delivery is written down. The two dates may differ. The distinction is kept.
Advance payment condition
For some jobs a partial advance payment may be requested. The conditions are written in advance. The practice is transparent.
Practice with new clients
Requesting an advance payment for the first jobs is normal. The reason is explained. It is relaxed as the relationship matures.
Interim payments
In long projects, payment tied to interim deliveries can be set up. Cash flow is balanced. The plan is written down.
Consequences of late payment
What happens if payment is late is defined. The provision is mutual and reasonable. The balance is preserved.
Suspending the service
In the event of a long delay, suspending the acceptance of new jobs may be provided for. The condition is written down. A warning is given in advance.
Protecting jobs in progress
It is preferred that jobs already started are not left half done. The client is not left stranded. The approach is professional.
Objection procedure
The period and form for objecting to an invoice are written down. An item that is not objected to may be deemed accepted. The period is defined.
An item under objection
It may be agreed that the amount other than the disputed item is paid. The whole invoice is not held back. The solution is practical.
Passing on official charges
Notary and verification charges are passed on with the expense document. These items are not a service fee. The distinction is kept.
Tax and deductions
The tax that applies and any deductions are stated. In transactions abroad the rules may differ. The situation is written down.
Payments from abroad
The currency, the exchange rate and who bears the transfer costs are written down. Uncertainty produces short payment. The field is filled in.
This section is not to be neglected
In practice a significant share of service relationships that run well become strained not for technical reasons but because the payment arrangement was not written down; a few lines given to this section remove the long correspondence with accounting that would otherwise follow. The article is taken seriously. The detail is written down.
Information on amounts
This page explains the payment arrangement; amounts appear only in the quote and on the invoice. Figures are not repeated here. The rule is permanent.