Due on receipt payment terms: meaning, due date

Due on receipt at a glance

Type

Cash terms

Full amount due

Immediately

Also written

payable on receipt, upon receipt, net 0

Example dates

What it means

Due on receipt is a cash term: the invoice is payable as soon as the buyer receives it. You will also see it written as payable on receipt, upon receipt or net 0. There is no net day and no month-end count; the credit period is zero days.

For the payment term you key, the due date is the invoice date. An invoice dated Thursday, Jan 15, 2026 is due Thursday, Jan 15, 2026. An invoice dated Friday, Feb 27, 2026 is due Friday, Feb 27, 2026. An invoice dated Friday, Dec 18, 2026 is due Friday, Dec 18, 2026. Those dates are not month-end due dates and none of them fall on a weekend.

The term is often treated as a courtesy request rather than a hard deadline. Many buyers pay these within a few days, but the vendor record should still carry zero days so the invoice does not sit in a later bucket. If you key it as a later net term by mistake, the invoice drops out of the current pay run and the supplier sees a late payment even though the original term was immediate.

When suppliers ask for it

Suppliers ask for Due on receipt when they want cash quickly: a first order with a new customer, a small or one-off purchase, a freight or courier charge, or a vendor that has had slow payment from other buyers. The request is common on invoices from trades, urgent supplies and vendors with thin working capital.

It also appears when the supplier and buyer have not agreed a formal term. The invoice arrives with Due on receipt printed at the top, and the AP clerk has to decide whether to key it as net 0 or apply the standard term from the vendor master. The safe approach is to follow the invoice if the vendor record is blank, but raise it with procurement or the budget owner so the vendor master can be corrected for future invoices.

Some suppliers use it as a collections tactic after an invoice has already been paid late. They reissue the invoice with Due on receipt to move it to the top of the queue. That is not a new invoice; check the invoice number and date before you treat it as one.

If a supplier offers a longer term in exchange for a fee or a discount, compare the rate with your own cost of funds before you accept. For a true Due on receipt invoice there is no discount window to manage; the full amount is due on the invoice date.

Paying safely

Start with the vendor record. Confirm the legal name, remit-to address and bank details match the vendor record you already hold. Do not change bank details from an email or a note on the invoice. For a Due on receipt invoice, the urgency of the term is not a reason to skip vendor verification.

Match the invoice to a purchase order and receiving record where one exists. Check the invoice number, invoice date and amount against the vendor record and the purchase order. If the invoice is dated Friday, Feb 27, 2026, the due date is Friday, Feb 27, 2026; the payment run should include it without waiting for a later cycle. If the invoice is dated Thursday, Jan 15, 2026, the same rule applies.

Run a duplicate check before you release payment. Use vendor, invoice number and invoice date, not just the amount. Suppliers often resend the same invoice with a different file name or a statement attached. A re-sent invoice dated Friday, Dec 18, 2026 is still the same invoice if the vendor and invoice number match an open item.

Do not pay a statement as well as the invoice. A statement is a list of open items, not a new request for payment. If the statement includes the Due on receipt invoice you have already scheduled, paying both creates a duplicate. Reconcile the statement to open invoices before you pay it.

Where these payments go wrong

The first mistake is keying the wrong term. An invoice marked Due on receipt is keyed as a later net term, so it misses the current pay run. The supplier calls, the AP team pays it late, and the next invoice from that supplier arrives with a tighter term or a hold. The fix is simple: treat Due on receipt as net 0 and use the invoice date as the due date.

The second mistake is counting from the received date instead of the invoice date. An invoice dated Thursday, Jan 15, 2026 may reach the AP inbox later, but the term is tied to the invoice date in the payment record. Counting from the received date gives you a false grace period and hides the fact that the invoice is already due. Use the invoice date for the three dated cases: Thursday, Jan 15, 2026; Friday, Feb 27, 2026; and Friday, Dec 18, 2026.

The third mistake is paying a statement as well as the invoice. The statement shows the same Due on receipt invoice as open, the AP clerk pays the statement total, and the invoice remains in the queue for the next run. The vendor receives two payments for one invoice. Match the statement lines to open invoices and clear the invoice before you pay the statement.

The fourth mistake is paying a re-sent invoice twice. A supplier resends an invoice dated Friday, Feb 27, 2026 because it has not been paid, and the AP team keys it as a new item. The duplicate check must use vendor, invoice number and invoice date, not the date the email arrived. If the invoice is already scheduled under the same number, the resend is a collection copy, not a new payable. A discount taken after the window is a related error: if an invoice carries a discount, the discount date is separate from the Due on receipt date, and taking it late creates a short pay that the supplier will chase.

Questions