Payment terms are a way for a company and a supplier to agree on a payment expectation and discounts. Perk allows these payment terms:
- Net days: the standard amount of days that the company and the supplier agree to pay the invoice. Example: net 30 days, net 60 days, etc.
- Cash discount days: some suppliers offer special discounts on the invoice if the bill is paid within a certain date. Usually, this can be 10 days at 2%. For example, if the company pays the supplier within 10 days, the company receives 2% discount.
- Cash discount percentage: The percentage discount on the invoice applied if the company pays the supplier within a certain time frame.
Perk makes a distinction between:
- Supplier-specific payment terms: Payment terms that are specific to a certain supplier. These are determined in the Supplier master data and can’t be reused with other suppliers.
- Company-level payment terms: Payment terms that are relevant and can be used for all suppliers linked to a certain company. These payment terms can be created in Perk and can be used for ALL suppliers of the company.
Account admins can choose to hide payment terms on the Invoice detail page in Settings > Supplier invoices > Invoice settings. You can hide them for a specific legal entity. In that case, payment terms are no longer visible on the invoice.
Adding a payment term
While supplier payment terms are linked to specific supplier and are imported into Perk (via CSV or API when creating the supplier), company-level payment terms are created in Perk (Settings > Supplier invoices > Payment terms).
The Payment terms page displays a complete list of payment terms that have been created for a company.
To add a new payment term, click + Add new.
| Field | Description |
|---|---|
| Name* | Name of the payment term. Use a description to help easily identify the payment term. |
| Code | External ID that identifies the payment term in a third-party system. |
| Net payment terms period | Usual standard payment period that your supplier demands for invoice payment. Example: 30 days, 60 days, etc. It needs to be a number. |
| Discount terms |
If applicable, you can set up discount terms that are applied for early payment:
|
Using payment terms
Invoice processors (and employees if allowed to edit the invoice) can select the payment terms for the invoice in the Payment term. You receive a supplier with a certain invoice date, due date and payment terms. When invoice processors code the invoice so it can be posted in the accounting system, they can select the payment term.
For example, you receive the invoice from the supplier Acme Inc. with a specific Invoice date. The invoice has 30 days net payment terms, meaning it needs to be paid within 30 days. You select the 30 days net payment term in the Payment term field.
When you select a payment term from a dropdown, Perk automatically computes the due date of the invoice with the following formula:
Due date = Invoice date + Net days of the payment term
If a supplier is detected on the invoice and selected in the Supplier field, then Perk automatically takes the payment terms set in the Supplier master data.
For example, to calculate the due date for an invoice with a supplier payment term:
- If Perk detects a due date AND the supplier has a default payment term, Perk takes the extracted due date, and ignores computation of the due date.
- If Perk detects an invoice date but not a due date AND supplier has a default payment term, Perk compute the due date with the payment term net days.
These payment terms can be overridden by selecting another payment term for the company in the Payment term field.