Payment Terms In Odoo

Payment Terms

Businesses regardless of industry or size, payment terms can be used to help receive payments on a predictable schedule. By this fixed payment, schedule organization can easily create a budget and make financial forecasts and can prevent any cash flow problems. There are different payment terms in Odoo ERP like immediate payment, 30% advance and balance after one month, etc. We can set different payment terms in Odoo and use it for both customer bills and vendor bills.

To create a new payment term:-
Invoicing  → Configuration → Management → Payment Terms

Create a new payment term by clicking create button.

Then create new payment term and add a description for invoice. This description will be displayed on the invoice.

Here new payment term is ‘40 % advance in 4 days and balance within 2 weeks’. Invoice description is added accordingly.

Then add term details by clicking Add an item. Please note that the last line’s computation type should be ‘Balance’ to ensure that the whole amount will be allocated. Otherwise can’t save the newly created payment term and show a warning.

This is the window when click Add an item.

Here we can see that 3 term types such as Balance, Percent and Fixed Amount

Different due date computation can be select as per the type needed.

• Day(s) after the Invoice date
• Day(s) after the end of the invoice month(Net EOM)
• Last day of the following month
• Last day of the current month

Then select the number of days.

The final Payment Terms look like:

Save the newly created Payment Terms in Odoo. New payment term is ready, then this payment term can apply on partner master, sales order and invoice. The usage of payment terms are in both customer bills and vendor bills.

• Partner Master

For setting new payment term to partner master

for customer payment terms go to:

 Invoicing →Sales →Master Data → Customer  

For vendor payment terms go to:

Invoicing →Purchases →Master Data → Vendor

Choose the appropriate payment terms for the partner in the Invoicing tab.

Customer payment:

vendor payment:

• Invoice

It is possible to set Payment terms  for particular invoices.

If we create a customer invoice for the above partner (partner which set payment terms). When we select the partner the payment term will be automatically added.

Go to :

Invoicing →Sales → Documents →Customer Invoices

Also, we can check the Journal Entries, also see that the entries are based on the payment terms.

Go to:

Adviser →Accounting Entries →Journal Entries

• Sales Order

We can also set payment terms in the sales order.

Select a Sales order in Orders in Sales module. Then you can set payment term.