Due date

The due date of an invoice is the date on which the invoice is due for payment - that is, the date on which a company/creditor last wants payment for their claim.

What is a due date?

Forfaldsdatoen i forbindelse med en betaling er den dato, hvor en udstedt faktura eller andet pengekrav forfalder til betaling eller indfrielse. Det er med andre ord den dato, hvor du som virksomhed og kreditor senest ønsker betaling for dine leverede produkter eller ydelser.

A company in Denmark is generally free to determine its own credit policy and thus its payment terms. The company can decide whether a customer must pay when the goods or services are delivered, or whether a payment deadline is set, for example 10 or 100 days in the future.

A company that provides relatively long payment terms and thus credit has an inherent risk that the amount is not paid or not paid on time.

A creditor can generally not expect to have the money in their bank account on the due date as long as the debtor transfers the amount on the due date. If the debtor and creditor do not have the same bank, the amount will often not appear in the creditor's account until 1-2 business days after the transfer. Despite this, the payment deadline and thus the due date has been duly observed.

The Customer has basically fulfilled its obligation to make the payment if the Customer has made the payment on the stated due date (or earlier).

Due date as a competitive parameter

Certain sectors, industries and customers may meet your company with due date requirements - already at the time of tendering. Examples include the construction industry, the food industry, large public institutions or other major players.

Many larger players may require, for example, a due date that is current month + 90 days from when an order is delivered. This will be a liquidity advantage for the customer, who may be able to sell your product before they have to pay for it themselves. At the same time, liquidity can be a disadvantage for you as a creditor - but act as a competitive parameter if, for example, your customers cannot obtain the same advantage from competitors. Thus, the due date can be an important parameter if a sale is to be achieved - and the turnover is to be realized. Remember to be aware of this and what your competitors are doing in this area.

What is the difference between due date and payment date?

Many people often confuse the terms due date and payment date, but this is not entirely correct.

In practice, many companies find that payment is not always made on the same day as the customer makes the payment, as a transaction in the customer's online bank is often not completed until the next banking day (weekday).

Thus, the due date is the date on which the customer must pay the invoice at the latest, while the payment date is the date on which the money is actually transferred. Depending on banking relationships, the payment date may vary, and as a creditor, you will in principle give credit during this period from due date to payment date.

The debtor also has the option to pay the claim before the due date, and thus there will also be a discrepancy between the payment date and the due date.

When has the debtor respected the due date?

The customer has basically complied with his/her obligation to pay if he/she has made the payment on (or before) the due date indicated.

As a business, you cannot expect the customer's payment to be in your account on the due date, so any reminder or collection process should not be started until at least a few business days after the due date.

Due date for debt collection

Basically, as a business, you can start collecting your money when you realize that the due date has passed. The creditor is not allowed to ask for payment before the due date. However, before a debt collection case starts, a debt collection notice must be sent, typically from the company itself, the company's debt collection company or the company's lawyer.

As there can be a difference between when the customer pays their invoice and when you as a company have the money in your account, it's often a good idea to wait at least a few business days before you start a reminder or collection process.

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