The contractual payment term is the period agreed upon between the supplier and the customer (in the general terms and conditions of sale, contract, or quote) for paying an invoice. In France, for transactions between businesses, it may not exceed 60 days from the invoice date, or 45 days from the end of the month if specified in the contract. In the absence of an agreement, it is 30 days from the date of delivery or service provision.
Example
The Terms and Conditions of Sale stipulate payment “45 days from the invoice date.” An invoice issued on June 1 must therefore be paid no later than July 16.
Why It’s Important
This deadline sets the due date for each invoice. It is used to calculate late payments, penalties, and the target DSO. Clear, written deadlines make it much easier to send payment reminders.
For more information: Late Payments: Calculation and Billing.
See also: Target DSO, late payment interest, payment schedule.
