How does prorated billing work when I upgrade or downgrade my plan? How does billing work when I cancel my plan?
Click either link below for further details specific to the EasyRoutes product you're using:
EasyRoutes for Shopify
This Shopify Help Center article describes the mechanics of prorating upgrades or downgrades:
"If you upgrade or downgrade your subscription with an app, then the app will prompt you to agree to a new recurring app charge. This is because Shopify allows each app only one recurring app charge to be enabled at a time. The existing recurring application charge will be canceled and replaced by the new charge.
Depending on the app, the new recurring app charge is either applied immediately, or after the app's current billing cycle ends.
If the new app charge is applied immediately, then when you upgrade your plan by moving from a less expensive charge to a more expensive charge, the charge is prorated based on the difference in price and the number of days remaining in the billing cycle. For example, if you begin a 30-day billing cycle on a $5.00 plan, and upgrade to a $15.00 plan on day 15 of the billing cycle, then you're charged $5.00 + ($15.00 - $5.00) * (15/30) = $10.00 USD.
If the new app charge is applied immediately, then when you downgrade your plan by moving from a more expensive charge to a less expensive charge, you're automatically offered an application credit based on the difference in price and the number of days remaining in the billing cycle. This application credit can be used towards any future application purchase on Shopify."
How does this appear on my bill or invoice?
To note there are two periods to account for on a Shopify bill:
- Your billing cycle (e.g. when your invoice was issued, and whether it's a 30-day cycle)
- The app's 30-day subscription cycle.
Note: if you have a bill or an invoice based on a billing threshold, upgrade or downgrade events that happen after the invoice date would appear on subsequent invoices for the same subscription cycle.
For a 30-day billing cycle, you may see charges and event related to two subscription cycles, but only inclusive of the dates for the billing cycle:
In general, upgrades and downgrades are processed against a 30 day subscription cycle, and Shopify works by creating charges and credits against the remainder of the 30 day subscription cycle. To note, events that happen after the invoice date would appear on the next invoice, but for the same subscription cycle.
Upgrades will be shown as charges in the Apps section of your Shopify bill. Downgrades will be shown under Credits in your Shopify bill.
For upgrades, you will see a charge for the difference from the previous plan, prorated to the remainder of the remaining 30-day cycle from the upgrade date (e.g. if the new app charge is applied immediately, then when you upgrade your plan by moving from a less expensive charge to a more expensive charge, the charge is prorated based on the difference in price and the number of days remaining in the billing cycle. )
For downgrades, you will see a credit for the difference from the previous plan prorated to the remainder of the 30-day cycle from the downgrade date (e.g. If the new app charge is applied immediately, then when you downgrade your plan by moving to a less expensive charge from a more expensive charge, the credit is prorated based on the difference in price and the number of days remaining in the billing cycle).
Cancellations: For a regular monthly subscription, you'll see a charge for the full 30-day cycle for the price of the plan at your current number of seats. If a subscription is cancelled in this cycle, then this is the final cycle that will be charged for the subscription plan. When you cancel a subscription—either by uninstalling the app or switching to our free plan—you’ll receive a final charge in your invoice covering the 30-day subscription period during which the cancellation occurred. This subscription period may not align exactly with your Shopify billing cycle, so these charges can sometimes appear after in the invoice after the cancellation event, but it should show the correct subscription cycle. For a detailed explanation of how app billing cycles work, please refer to Shopify’s documentation.
If you have further questions or need billing-related assistance, feel free to contact our support team.
EasyRoutes for Web
This Stripe support article describes the mechanics of prorating upgrades or downgrades:
"When a subscription is upgraded, Stripe will automatically calculate the prorated amount that the customer owes. For example, if a customer is moved from a US$10.00/mo subscription price to a US$100.00/mo subscription price in the middle of their billing cycle, they are owed a US$5.00 credit for the first price and they owe US$50.00 for the new price. This means that they owe a total of US$45.00 for the subscription upgrade. This amount can be charged at the end of the billing cycle or immediately by creating an invoice.
When a subscription is downgraded or cancelled, the customer may be owed a credit. If a customer moves from a US$100.00/mo subscription price to a US$10.00/mo subscription price in the middle of the billing cycle, they are owed US$50.00 for the first price and owe US$5.00 for the new price. A total of US$45.00 is now owed to the customer for the subscription downgrade, and that credit ends up being added to their credit balance to be applied to future invoices."
How does this appear on my bill or invoice?
Plan upgrade or downgrade transactions are processed and invoiced immediately, including any credits or additional charges that apply, depending on your plan change.
For upgrades, you will see a charge for the difference from the previous plan, prorated to the remainder of the remaining monthly cycle from the upgrade date (e.g. if the new charge is applied immediately, then when you upgrade your plan by moving from a less expensive charge to a more expensive charge, the charge is prorated based on the difference in price and the number of days remaining in the billing cycle.)
For downgrades, you will see a credit for the difference from the previous plan prorated to the remainder of the monthly cycle from the downgrade date (e.g. If the new charge is applied immediately, then when you downgrade your plan by moving to a less expensive charge from a more expensive charge, the credit is prorated based on the difference in price and the number of days remaining in the billing cycle).