Invoice payment terms in Australia

Payment terms on an Australian invoice are whatever you agreed with the customer. There is no default period set by law for ordinary business invoices, so the terms you print are the terms that apply, provided they were agreed before the work and match your quote or contract. The common choices are due on receipt, 7, 14, 21 or 30 days, and the right one is the shortest your customers will reliably meet.

This article is about choosing and wording those terms. The details a tax invoice must contain are covered in how to write an invoice, and chasing one that is late in how to chase an unpaid invoice.

The common terms

business.gov.au describes payment terms as the rules your business sets for how and when customers must pay, and notes that they form part of the sales contract. It gives 7, 14, 21 or 31 days as typical credit terms in business to business work.

In practice:

• Due on receipt suits small one off jobs and customers you will not see again.
• 7 days suits trades and repairs, where the job is short and the customer is often an individual.
• 14 days is the most common middle ground for service businesses.
• 21 days suits events and projects where the customer needs a sign off before paying.
• 30 days suits business customers with a monthly accounts payable run.

Phrases like “net 30” mean 30 days from the invoice date; the net 30 question page explains the variations, such as end of month terms.

The table above applies each option to the same $4,400 invoice issued on Monday 2 November 2026. The due date column is the one to print on the invoice. “Due 16 November 2026” leaves no room for interpretation; “14 days” invites the customer to count from when they opened the email.

What the ATO requires on the invoice

If you are registered for GST and the sale is taxable, a tax invoice for a sale under $1,000 must show seven things according to the ATO: that it is a tax invoice, your identity, your ABN, the date of issue, a brief description of what was sold with quantity and price, the GST amount (or a statement that the total includes GST when GST is exactly one eleventh), and the extent to which each item is taxable. For sales of $1,000 or more, the buyer’s identity or ABN must also appear. If a customer asks for a tax invoice, you must provide one within 28 days, unless the sale is $82.50 or less including GST.

Payment terms are not on the ATO’s list, but they are on every practical one. business.gov.au’s invoicing guide includes the due date and how to pay. See do I need an ABN on my invoice for the ABN rules.

Terms that get paid

Terms are paid when they are clear, agreed and easy to act on.

Agree them before the work. Put the payment terms in the quote or proposal, so accepting the quote accepts the terms. A payment terms clause in your standard terms does this in one paragraph.

Print a date. A calendar due date beats a number of days every time.

Make paying one step. Bank details on the invoice are the minimum. A pay link that opens a card payment page removes the step of copying a BSB and account number, which matters for customers paying from a phone.

Remind before it is late. A reminder three days before the due date catches the customer who meant to pay and forgot. In OneCraft, the standard reminder preset sends one three days before the due date, one on it, and three, seven and fourteen days after; the gentle preset sends only on the due date and seven days after; firm sends six. An invoice turns overdue the day after its due date, and no invoice gets more than six reminders. The invoice reminders page shows the presets.

Deposits and progress payments

The longer the job, the less sense it makes to wait until the end to be paid. A deposit on acceptance covers materials and confirms commitment, and progress payments at milestones keep cash moving on longer projects.

In the 18 proposal templates counted for this article, 11 set a deposit, ranging from 10% on a construction estimate to 50% on web design, photography and printing jobs. The other seven are monthly services and short jobs, where the first month’s invoice or a short term does the same job.

When a OneCraft proposal with a deposit is accepted, a deposit invoice is issued due that day and emailed to the customer, and the balance invoice waits as a draft until you issue it. Without a deposit, one invoice is issued due in 14 days. The deposit invoice and progress invoice pages cover both in more depth.

Late fees and interest

You can generally only charge a late fee or interest if the customer agreed to it before the work started. A rate added to an overdue invoice for the first time is unlikely to hold up. If you want the option, state it in your terms: a fixed fee or an annual interest rate on overdue amounts, applied from the day after the due date. Whether to enforce it is a separate decision. See late payment fees in Australia.

Big customers and payment times

Large businesses have their own payment cycles, and many small suppliers wait 30 days or more. The Payment Times Reporting Scheme requires large entities that meet its revenue threshold to report how quickly they pay their small business suppliers, twice a year, each report due within three months of the end of its six month period. The published reports are a reasonable way to check how a big customer treats suppliers before agreeing to long terms.

Chasing

business.gov.au recommends starting with a polite reminder by phone or email, because many late payments are forgotten rather than refused, then a letter of demand or a debt collector if that fails. Automated reminders handle the first steps without the awkwardness, and keep the tone the same every time. The full sequence, from the first reminder to small claims, is in how to chase an unpaid invoice.

An invoice laid out with all of the above is in the invoice example.