Net 60 Payment Terms: Meaning, Real Cost and How to Offer Them (2026)

A big customer sends over its supplier form, and the payment terms box already says "Net 60." Most UAE suppliers sign it. Few work out what it actually costs them first.

Short answer: net 60 means the buyer must pay the full invoice amount within 60 days of the invoice date. There is no discount for paying early unless the terms say so, and payment is late from day 61. For the seller, net 60 means carrying roughly two months of sales as unpaid receivables, which is cash you have already spent on goods, staff and VAT.

What does net 60 mean?

"Net" refers to the full invoice amount after any agreed deductions, and "60" is the number of days the buyer has to pay it. An invoice dated 1 March on net 60 terms is due on 30 April.

The clock usually starts on the invoice date, but some contracts start it on delivery or on receipt of the invoice, so write the trigger into your terms.

For a full overview of the other common terms, see our guide to business payment terms.

Common net 60 variations

• Net 60 EOM (end of month). The 60 days start at the end of the month the invoice was issued. An invoice dated 3 March is then due on 30 May, so the real term is closer to 90 days.
• 2/10 net 60. The buyer can take a 2% discount by paying within 10 days. Otherwise the full amount is due in 60 days.
• Net 60 from receipt of goods. Common in retail and FMCG, where the buyer counts from the date goods arrive at its warehouse.

Net 30 vs net 60 vs net 90

• Net 30 is the most common term in UAE B2B trade. Atradius found that about three in five UAE companies offer B2B customers terms of up to one month from invoicing [1].
• Net 60 is the next step up. Around one in three UAE firms offer terms of between one and two months, and Atradius reports a clear shift toward longer terms, led by mid-sized industrial firms [1].
• Net 90 and longer terms are most often seen in construction, according to Atradius [1].

Other markets treat 60 days as a ceiling. In the UK, an agreed payment date for business transactions must usually fall within 60 days, and a longer period must be fair to both businesses [2]. The UAE has no equivalent cap, so the term is whatever you and your buyer agree.

What net 60 really costs the seller

Offering net 60 means carrying your customer's purchases for two months. Three costs follow.

1. Cash tied up in receivables

If you sell AED 500,000 a month on net 60, about AED 1,000,000 of your money sits in unpaid invoices at any time. On net 30 it would be about AED 500,000. Our cash conversion cycle calculator shows how longer terms stretch the gap between paying suppliers and getting paid.

2. Late payment on top of the term

Net 60 rarely means 60 days. Atradius found that roughly two in five UAE B2B invoices are paid late, that more companies report longer collection cycles, and that bad debt write-offs now account for just over 2% of B2B receivables [1]. A net 60 invoice paid three weeks late is really an 81-day term. Price the delay with our cost of late payment calculator.

3. VAT you pay before you are paid

This is the cost most suppliers miss. Under UAE VAT law, tax is due on the date of supply, which is the earliest of events such as the transfer of goods, completion of services, receipt of payment or issue of the tax invoice [3]. The VAT return and payment are due by the 28th day after the end of the tax period [4].

So if you issue a AED 105,000 invoice including VAT on the last day of a quarter on net 60 terms, you have to pay the AED 5,000 of VAT around four weeks after the quarter ends, roughly a month before your customer's payment is due. If the customer never pays, bad debt relief is only available once more than six months have passed from the date of supply and the debt has been written off, among other conditions [3].

Buyers face a rule too. A VAT-registered buyer can only keep the input tax it has recovered if it intends to pay before six months after the agreed payment date [4]. That gives you a useful point when chasing a long-overdue invoice.

Is 2/10 net 60 worth offering?

An early payment discount is the classic fix, but check the price. A buyer who takes 2% to pay on day 10 instead of day 60 is earning that 2% for paying 50 days early. Annualized, that is roughly 15% a year (2/98 × 365/50), which you are paying.

That can make sense for a large customer who would otherwise pay on day 80, but rarely across your whole ledger. Run your own numbers with our early payment discount calculator.

When to agree to net 60

Net 60 is reasonable when:

• The buyer is large, pays reliably and the account is worth the wait.
• Your gross margin can absorb the cost of carrying two months of sales.
• You have a way to get paid upfront on the invoices, so the term is your customer's benefit rather than your cash problem.

Push back when the buyer is new or pays erratically, or when your own suppliers want payment in 30 days or less.

How to protect yourself when you offer net 60

1. Put the terms in writing. State the trigger date, the due date and any late payment charge on the quote, contract and invoice.
2. Invoice the same day you deliver. Every day of delay is added to the 60.
3. Remind before the due date, not after. A friendly note at day 50 heads off most late payments.
4. Track DSO monthly. If your days sales outstanding drift past 70 on net 60 customers, act early. Our guide on how to reduce DSO has practical steps.

Offer net 60 and still get paid upfront

The best outcome is when your customer gets the term and you get the cash. That is how Comfi B2B Buy Now Pay Later works: your buyer pays in 30, 60 or 90 days, and you are paid upfront within hours of an approved invoice. Comfi is not a lender and does not provide loans. It is a business loan alternative that unlocks the cash stuck in receivable invoices, so nothing is borrowed.

Across Comfi's customers, the average buyer payment term is 90 days, and the median time from an approved invoice to funds in the bank is about 20 hours (Comfi data; a median, not a guarantee). More than 1,000 UAE SMEs have unlocked cash on AED 600M+ of invoices with Comfi.

Binja, a Dubai building materials trader, worked on standard 60-day payment cycles that often ran another 15 to 30 days. With Comfi it turned outstanding invoices into immediate liquidity, cut DSO by 25% and grew sales by 20% (read the case study). If you already have net 60 invoices outstanding, Comfi Invoice Discounting unlocks cash from those too.

Comfi works with UAE-registered B2B companies operating for 12 months or more with monthly revenue of AED 300,000 or more. Check your eligibility in a few minutes.

Frequently asked questions

What does net 60 mean on an invoice?

It means the buyer must pay the full invoice amount within 60 days, usually counted from the invoice date. Payment on day 61 or later is late.

What is the difference between net 60 and 60 days EOM?

Net 60 counts 60 days from the invoice date. 60 days EOM counts from the end of the invoice month, so payment can arrive up to a month later.

Do I pay VAT on a net 60 invoice before the customer pays?

Often, yes. UAE VAT is due based on the date of supply, not the date you are paid, so the VAT on a net 60 invoice can fall due before your customer settles [3].

Sources

1. Atradius, "B2B payment practices trends in the United Arab Emirates 2026" (Payment Practices Barometer, July 2026). Supports payment term mix, late payment and bad debt figures. Link.
2. GOV.UK, "Late commercial payments: charging interest and debt recovery" (accessed October 2026). Supports the UK 60-day benchmark. Link.
3. UAE Federal Tax Authority, Federal Decree-Law No. 8 of 2017 on VAT and amendments, Articles 25 (date of supply) and 64 (bad debts) (accessed October 2026). Link.
4. UAE Federal Tax Authority, Cabinet Decision No. 52 of 2017 (VAT Executive Regulation) and amendments, Articles 54 and 64 (accessed October 2026). Link.