Net 10th Prox is a business-to-business payment term that makes every invoice issued during the current month due on the 10th of the following month. The invoice date doesn’t start a countdown. The due date is simply the 10th, every month, for everything billed in the prior month.
What Each Part of the Term Means
“Net” means the full invoice amount is owed, with no discount built in.
“10th” is the fixed calendar day payment is due. Variations like Net 15th Prox or Net 25th Prox work identically, just with a different day.
“Prox” is short for the Latin proximo mense, meaning “in the next month.” It tells you the relevant month isn’t the one the invoice was issued in, but the one after. Infor’s enterprise software documentation describes Prox as a term rooted in retail, where invoices that didn’t meet a designated cutoff for one month were paid in the next, in a pattern similar to credit card billing cycles.1Infor. What Is a Prox Term
How to Calculate the Due Date
Take the month the invoice was issued, move forward one month, and land on the 10th. An invoice dated June 1 and an invoice dated June 28 are both due July 10. Oracle’s proximate date payment term documentation shows the same pattern: an invoice dated May 20 with a proximate month of 1 and proximate day of 10 produces a June 10 due date.2Oracle. Proximate Date Payment Terms
The practical consequence is that your actual credit period swings widely depending on when the invoice hits. A June 1 invoice gives 39 days before payment is due. A June 28 invoice gives 12. Accounts payable teams that aren’t batching carefully can get surprised by late-month invoices with compressed timelines.
Cutoff Dates
Many Prox arrangements include a cutoff date that controls which cycle a late-month invoice falls into. Without one, an invoice dated June 29 is technically due July 10, barely a credit period at all.
A cutoff solves this by rolling late-month invoices to the next cycle. Aptora’s payment terms documentation describes the mechanism: when an invoice is issued within a set number of days before the due date, payment is not due until the following month.3Aptora Corporation. Payment Terms List With a 25th cutoff, a June 27 invoice would skip July 10 and instead come due August 10.
Cutoffs are not universal, and the day varies by contract. If the agreement says “Net 10th Prox” with no cutoff mentioned, every invoice issued during the month is due on the 10th of the next month, no matter how late in the month it was sent. Put this detail in writing rather than assuming it.
Discount Variations
Prox terms can carry early-payment discounts. A term written as “1% 10th Prox Net 25th Prox” means the buyer gets a 1 percent discount if payment arrives by the 10th of the next month, with the full amount due by the 25th. Oracle’s documentation gives a concrete example: an invoice dated June 14 with a 1 percent discount, 10 discount days, a proximate month of 1, and a proximate day of 10 produces a discount due date of June 24 and a net due date of July 10.2Oracle. Proximate Date Payment Terms
When the 10th Falls on a Weekend or Holiday
Commercial contracts commonly include a provision that shifts a due date falling on a non-business day to the next business day. If July 10 is a Saturday, payment would be due Monday, July 12. This is a contractual provision, though, not an automatic legal default. If the agreement is silent, pay before the 10th rather than after.
Late Payment Consequences
Missing a Prox due date carries the same consequences as missing any other invoice deadline. Specific penalties depend on the contract and applicable state law, but late payment interest rates in commercial agreements typically range from around 10 to 24 percent annually. Some states have prompt payment statutes that impose their own interest rates on overdue commercial invoices, often in a similar range.
Beyond interest, chronic lateness under Prox terms can trigger credit holds, shortened payment terms on future orders, or loss of early-payment discount privileges. Because Prox consolidates a full month of invoices into a single due date, missing it means every invoice from the prior month is overdue at once, which amplifies both the financial hit and the vendor relationship damage.
How Net 10th Prox Differs From Net 30 and EOM
The core difference between Net 10th Prox and a date-of-invoice term like Net 30 is what anchors the due date. Net 30 starts a 30-day countdown from each individual invoice, so every transaction has its own deadline. Net 10th Prox ignores the invoice date entirely and pins everything to one calendar day.
End of Month (EOM) terms sit in between. “Net 10 EOM” means payment is due 10 days after the end of the invoice month. For a June invoice, that works out to July 10, matching Net 10th Prox exactly. The distinction gets clearer with different day values. “Net 15 EOM” on a June invoice means July 15 (15 days after June 30), while “Net 15th Prox” also means July 15 but arrives there by naming the 15th day of the next month directly. The two approaches produce the same result when the day count and the calendar day happen to match, and diverge when they don’t. Contracts should specify which method applies rather than treat the two as interchangeable.
Setting It Up in Accounting Software
Most accounting and ERP platforms handle Prox through a “date-driven” payment term configuration. In QuickBooks Desktop, you create a new term under the Customer and Vendor Profile Lists, select “Date Driven” instead of the standard day-count method, and enter the calendar day and month offset.4QuickBooks Community. How to Enter Payment Terms for Net Due 1% 10th Prox, Net 15th Prox Enterprise systems like JD Edwards use “proximate month” and “proximate day” fields to produce the same result.2Oracle. Proximate Date Payment Terms
If the software doesn’t support date-driven terms natively, some businesses set due dates manually or run a reminder tied to the 10th of each month. That gives up most of the efficiency Prox is supposed to deliver, so configure the system correctly from the start. When a cutoff date is part of the deal, build that in too, or late-month invoices will show artificially short due windows and generate false overdue alerts.