Payment Terms
UC Davis Allowed Payment Terms
| Method | Payment Terms |
|---|---|
| Payment Plus Virtual Card (through US Bank) |
Net Due The invoice is paid immediately upon approval. |
|
Automated Clearing House (ACH) |
2/10 NET 30 If the UC pays the invoice within 10 days, the payment amount will automatically be reduced by a 2% discount. If we are unable to pay within 10 days, we will pay the full amount due in 30 days. |
| Automated Clearing House (ACH) Electronic Funds Transfer (EFT) |
NET 45 *The invoice is paid 45 days after the invoice is received by the UC.1 |
Benefits of Payment Plus
- Supplier receives an email from US Bank with a link to a one-time credit card number which is a more secured method than receiving a paper check via mail
- Supplier benefits from faster receipt of their money
- UC Davis benefits through US Bank incentives and more efficient processing
Benefits of Automated Clearing House
- Supplier receives direct deposit into their bank account from an Automated Clearing House (ACH)
- Supplier benefits from faster receipt of their money
- UC Davis benefits from early payment discounts and more efficient processing
Enrollment is Easy
- Email aphelp@ucdavis.edu to enroll
Payment Terms (by exception only)
| Method | Payment Terms |
|---|---|
|
Paper Check2 |
2/10 NET 45 If the UC pays the invoice within 10 days, the payment amount will automatically be reduced by a 2% discount. If we are unable to pay within 10 days, we will pay the full amount due in 45 days. |
|
Paper Check |
NET 60 The invoice is paid 60 days after the invoice is received by the UC. |
Why Paper Checks are Discouraged
- Supplier receives a paper check in the mail, which increases the risk for fraud and theft
- Costly for supplier, as they have to deposit checks and wait for available funds from their bank
- Costly for UC Davis, as we have to print, handle, and mail paper checks
Early Payment Discounts
When Discounts Apply
- Discounts are applied if the payment is approved within the number days allowed by the payment terms selected on the Purchase Order
- (Approval Date) – (Invoice Date) <= Discounts Days Allowed
- The Disbursement Date, or payment date, is the maximum allowed to receive a discount, or the maximum allowed by the payment
- If the Purchase Order and the Invoice have conflicting payment terms, UC Davis will take the more advantageous terms when processing the payment
- Discount terms are not available on sub-award invoices
What is Discounted?
Early payment discounts apply to the entire order, less shipping or freight charges.
Sales tax is calculated after discounts are applied.
Example: $100 invoice line, $10 shipping, 7.5% tax rate, 2% discount
$100 x .02 = $2 discount = $98 line amount after discount
$98 x .075 = $7.35 sales tax
$100 line + $7.35 tax + $10 shipping - $2 discount = $115.35 net