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Odoo 11 Accounting: Payment Terms


Purpose

The purpose of this documentation is to outline how to set up and use Payment Terms in Odoo.

Payment terms designate the conditions to pay an invoice. They can be set on a contact, quote, invoice, purchase order or vendor bill.

Processes

To get started, navigate to the Accounting application.

Odoo - Sample 1 for three columns


Creating a Payment Term

Once there, click on Configuration and then Payment Terms.

You will be presented with a list of existing payment terms, which you can view and edit. You can also create a new payment term by hitting the Create button.

The only required field is Payment Terms, which is the name of your payment term. In the below example, we're using "50% Immediate + Remaining after 15 Days".

You may also add a Description on the Invoice, which is an explanation of the payment terms for your customer. This is not a required field.

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Click Add an item to create a term and a modal will appear. Choose a term type and enter the desired value. Then choose the due date, entering in the number of days (if required).

When finished, hit the Save & Close button or Save & new if there is another term you wish to add.

  Term Types

There are three different term types to choose from:

  • Balance: Total remaining amount of the invoice

  • Percent: Percentage of the total invoice

  • Fixed Amount: Fixed dollar amount

Example Payment Term

Going ahead with our "50% Immediate + Remaining after 15 Days" example, we have configured the following:

  • Term Type: Percent

  • Value: 50%

  • Number of Days: Day(s) after the invoice date

  • Days: 0, for immediate payment

Then hit the SAVE & NEW button to create our next term.

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Now we will account for the second part of our Payment Term.

  • Term Type: Balance (for the total remaining amount of the invoice)

  • Number of Days: Day(s) after the invoice date

  • Days: 15

Since this is the last term, we will hit the Save & close button when finished.

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  Important!

When creating a payment term with multiple lines, it is crucial that the last one is for the Balance. This is to ensure the invoice will be paid in full and you won't be left with only partial payment.

When finished, hit  save .

Payment Terms and Reporting

In Accounting, your Aged Payables and Aged Receivables reports will reflect the expected incoming or outgoing funds based on payment terms.


Applying Payment Terms

Applying Payment Terms to Contacts

Within the Contacts app, or through the Customers menu item in CRM or Sales, navigate to a contact.

Click the Edit button and then select the Accounting tab.

Here you will see two Payment Term fields:

  • Customer Payment Terms: The terms by which this contact will pay you when they are acting as a customer.

  • Vendor Payment Terms: The terms by which you will pay this contact when they are acting as a vendor.

When ready, hit Save.

If Payment Terms are set on the contact, they will be automatically applied to this contact's sale orders and invoices (for Customer Payment Terms) and/or purchase orders and vendor bills (for Vendor Payment Terms).



Applying Payment Terms on Quotations + Sale Orders

Within the Sales app, click Orders and then Quotations.

Create a new quote by hitting the Create button.

Select the customer first, to ensure they do not have specified Customer Payment Terms.

If they do have a specified payment term on their contact, it will be auto-applied. If not, choose your payment term from the dropdown menu.

Proceed with creating the rest of the quote, then hit Save when ready.


Applying Payment Terms on Invoices

Within the Accounting app, click Sales and then Customer Invoices.

Create a new invoice by hitting the Create button.

Select the customer first, to ensure they do not have specified Customer Payment Terms. Then choose your payment term from the dropdown menu.

Proceed with creating the rest of the invoice, then hit Save and Validate when ready.


After validating the invoice, the Due Date field on the invoice is the final due date in the payment term (15 days, in our example).

Applying Payment Terms on RFQs + Purchase Orders

Within the Purchases app, click Purchases and then Request for Quotation.

Create a new RFQ by hitting the Create button.

Select the vendor first, to ensure they do not have specified Vendor Payment Terms.

If they do have a specified payment term on their contact, it will be auto-applied. If not, choose your payment term from the dropdown menu under the Deliveries & Invoices tab.

Proceed with creating the rest of the RFQ, then hit Save when ready.


Applying Payment Terms on Vendor Bills

Within the Accounting app, click Purchases and then Vendor Bills.

Create a new vendor bill by hitting the Create button.

Select the vendor first, to ensure they do not have specified Vendor Payment Terms. Then choose your payment term from the dropdown menu under the Other Info tab.

Proceed with creating the rest of the vendor bill, then hit Save and Validate when ready.


After validating the vendor bill, the Due Date field on the vendor bill is the final due date in the payment term (15 days, in our example).