Payment Term dialog box: options and information

In the Payment Term dialog box, you can add or edit the payment terms, descriptions, payment due and any early payment discounts that your company offers to a customer, that a supplier offers to your company or that relate to VAT payments to tax agencies.

Open the dialog box

To open the Payment Term dialog box:

  1. On the Company menu, point to Manage Support Lists and then click Payment Terms List.

  2. In the Manage Payment Term dialog box, click Add or Edit.

    Dialog box options

    The dialog box contains the following options.

Option

Description

Payment term

(Required.) Type the payment term name, for example, COD, Net 30 or 1%10 Net 30. The name 1%10 Net 30 means that the invoice is due in 30 days, but if it is paid within 10 days, an early payment discount of 1% can be taken.

Description

Type a description of the payment terms. For example, the name 1%10 Net 30 can be described as "Discount 1% if paid within 10 days."

Due
and days

You can use these two fields either together or separately, depending on the payment term that you create. If the payment term indicates the number of days after an invoice date that a payment is required, type that number in the and days field and leave the Due field empty. For example, if the term is Net 30 or 1%10 Net 30, type 30 in the and days field and type any discount information in the Early Payment Discount section of the dialog box.

There are payment term types that do not refer to a specific invoice date, but instead refer to the invoice period. For example, you can create a payment term named Monthly 10, meaning that any invoice from any month, regardless of the date, is due by the tenth calendar day of the following month.

The monthly, quarterly or annual terms that Microsoft Office Accounting 2008 creates for payments to VAT agencies also use this feature because VAT payments are usually due at a required time after the month, quarter or year ends. The amounts due to the tax agencies displayed in the Pay VAT dialog box are based on the payments terms you select for HM Customs & Excise.

Click the Due arrow and then click one the following options:

Current Month—After you select this option, you can type a number in the and days field to indicate the day that the invoice is due in the following month. For example, if you type 10 in the and days field, an invoice that is dated 28 November would be due on 10 December.

Current Quarter—After you select this option, you can type a number in the and days field to indicate the day that the invoice is due in the following month after the current quarter. For example, if you type 10 in the and days field, an invoice dated 28 August would be due on 10 October, because October is the month immediately following the third quarter of the year.

Current Half Year—After you select this option, you can type a number in the and days field to indicate the day that the invoice is due in the following month after the current half year. For example, if you type 10 in the and days field, an invoice dated 28 July would be due on 10 January in the next year, because January is the month immediately following the current half year.

Current Year—After you select this option, you can type a number in the and days field to indicate the day that the invoice is due in the following month after the current half year. For example, if you type 10 in the and days field, an invoice dated 28 March would be due on 10 January in the next year, because January is the month immediately following the current year.

Payroll Tax Month—HMRC can require that payroll taxes withheld be paid within a certain number of days after the end of a current month. After you select this option, you can type the number in the and days field to indicate the day that the withheld taxes are due to be paid. For example, if you type 19, payroll taxes withheld for the month of August would be due on 19 September.

Payroll Tax Quarter—HMRC can require that payroll taxes withheld be paid within a certain number of days after the end of a current quarter. After you select this option, you can type the number in the and days field to indicate the day that the withheld taxes are due to be paid. For example, if you type 19, payroll taxes withheld for the quarter ending 30 September would be due on 19 October.

Discount

Type a number to indicate the percentage discount that you are offering to a customer. Common discounts are 1% and 2%. Accounting 2008 adds the % symbol.

Note: The more quickly a company can turn its receivables into cash, the better it is. Because of this, many companies offer an inducement for early payment.

if paid within

Type the number of days in which an invoice has to be paid to take advantage of the discount.


Related topics

About support lists

Add or edit data in support lists

Remove data from support lists

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