Terms of Payment Template

Terms of Payment Template

The following Terms of Payment form part of the agreement between the Parties.

1. Definitions

For purposes of these Terms of Payment:

• “Provider” means [Provider Legal Name].

• “Client” means [Client Legal Name].

• “Services / Goods” means the services and/or goods described in the main agreement or statement of work.

• “Fees” means all amounts payable by Client to Provider in connection with the Services / Goods.

2. Fee Structure

2.1 Fee Basis.
Unless otherwise stated in the main agreement, Fees are calculated on the following basis:

• [Hourly / daily / time-based fees]; and/or

• [Fixed project or package fees]; and/or

• [Retainer or subscription fees]; and/or

• [Milestone-based fees tied to specific deliverables].

2.2 Rate or Price.
The applicable fees, rates, and prices are set out in:

• [Annex / Schedule “Fees and Rates”]; or

• [Section reference in main agreement].

3. Invoicing

3.1 Invoice Frequency.
Provider shall issue invoices to Client on the following basis:

• [Monthly / Biweekly / On completion of milestones / On delivery of goods / Other].

3.2 Invoice Content.
Each invoice shall include at least:

• Provider and Client names and addresses;

• Invoice date and unique invoice number;

• Description of Services / Goods and period covered;

• Breakdown of Fees, taxes, and approved expenses;

• Total amount due and payment instructions.

3.3 Delivery of Invoices.
Invoices may be delivered to Client by:

• Email to: [Billing Email Address]; and/or

• Online portal: [Portal URL]; and/or

• Postal mail to: [Billing Address].

4. Payment Terms

4.1 Due Date.
Unless otherwise stated on the invoice, Client shall pay all undisputed amounts within [Number] days from the invoice date.

4.2 Currency.
All payments shall be made in [Currency], unless the Parties agree in writing to another currency.

4.3 Payment Methods.
Client shall make payments using one or more of the following methods:

• Bank transfer to the account specified by Provider;

• Credit or debit card, if accepted by Provider;

• [Other accepted methods, such as PayPal or local systems].

4.4 Payment Details.
Bank transfer payments shall be made to:

• Account Name: [Account Name]

• Bank Name: [Bank Name]

• Bank Address: [Bank Address]

• Account Number / IBAN: [Account Number / IBAN]

• SWIFT / BIC (if applicable): [SWIFT/BIC]

• Payment Reference: [Invoice Number / Client Name]

5. Taxes and Withholding

5.1 Taxes.
Unless expressly stated otherwise, Fees are [exclusive / inclusive] of applicable taxes. Client is responsible for any sales, value-added, or similar taxes arising from the provision of the Services / Goods, except taxes based on Provider’s income.

5.2 Withholding.
If Client is legally required to withhold any tax from payments to Provider, Client shall:

• Withhold only the minimum amount required by law; and

• Provide Provider with official documentation of the withheld tax, if available.

6. Expenses (If Applicable)

6.1 Reimbursable Expenses.
Client shall reimburse Provider for reasonable, pre-approved out-of-pocket expenses directly related to the Services / Goods, such as travel, accommodation, or materials, if such reimbursement is permitted under the main agreement.

6.2 Evidence of Expenses.
Provider shall provide receipts or other reasonable proof of reimbursable expenses when invoicing Client for those amounts.

7. Late Payment

7.1 Late Payment Definition.
A payment is considered late if any undisputed amount is not received by Provider by the applicable due date.

7.2 Late Fees and Interest.
If Client fails to pay any undisputed amount when due, Provider may charge:

• A late fee of [Amount or Percentage] on the overdue balance; and/or

• Interest at [Interest Rate]% per year (or the maximum rate permitted by law), calculated from the day after the due date until payment is received.

7.3 Suspension of Services / Deliveries.
If any invoice remains unpaid for more than [Number] days after the due date, Provider may suspend or delay Services / Goods until all overdue amounts are paid, after notifying Client where practicable.

8. Disputed Invoices

8.1 Notice of Dispute.
If Client disputes any part of an invoice in good faith, Client shall:

• Notify Provider in writing within [Number] days of the invoice date; and

• Identify the disputed amount and provide a brief explanation and any supporting information.

8.2 Payment of Undisputed Portion.
Client shall pay the undisputed portion of the invoice by the original due date.

8.3 Resolution of Dispute.
The Parties shall use reasonable efforts to resolve the dispute promptly. Any agreed adjustment shall be reflected in a credit note or a revised invoice.

9. Price Changes (For Ongoing Engagements)

9.1 Adjustment of Rates.
For ongoing or long-term engagements, Provider may adjust its standard rates or fees by giving Client at least [Number] days’ prior written notice.

9.2 Client’s Options.
If Client does not agree to the adjusted rates, Client may terminate the agreement in accordance with the termination clause in the main agreement before the new rates take effect.

10. Set-Off and Deductions

10.1 No Unauthorized Deductions.
Client shall not set off, withhold, or deduct any amount from payments due to Provider unless:

• Required by applicable law; or

• Specifically agreed in writing by the Parties.

10.2 Mutual Set-Off (If Agreed).
If the Parties agree to mutual set-off rights, the conditions and limits of such set-off shall be described here:

[Description of any agreed set-off rules].

11. Records and Audit (Optional)

11.1 Records.
Provider shall maintain reasonable records of invoices issued, payments received, and reimbursable expenses related to the Services / Goods.

11.2 Audit Rights (If Any).
If the Parties agree that Client may review billing records, the scope and frequency of such review shall be:

[Description of permitted review or audit process].

12. Governing Law for Payment Terms

These Terms of Payment are subject to the governing law and dispute resolution provisions of the main agreement between the Parties. If the main agreement does not specify governing law, the law of [State/Province, Country] shall apply to these Terms of Payment, without regard to conflict-of-law rules.

13. Order of Precedence

If there is any conflict between these Terms of Payment and other parts of the agreement:

• The specific fee or payment terms written in a statement of work, order form, or schedule will take precedence over general terms in this section, but only for that particular project or order; and

• Otherwise, these Terms of Payment shall govern payment-related matters.

14. Acceptance

By signing the main agreement that incorporates or attaches these Terms of Payment, the Parties agree that these Terms of Payment are binding and form part of their overall contract.