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Billing Cycle for Addons 

Overview 

Breaking down a charge as high as say a $1000 setup fee, will make your customer's life easy.

With Chargebee, you can give your customers the option to make the payment for such charges, that is not the subscription charge, in installments. These charges will be considered as ‘Addons with a Billing Cycle'.

Billing Cycle is the number of times the customer will be charged.
During the course of time of the billing cycle mentioned, the amount mentioned as the Unit Price of the Addons will be collected from the customer.

Say, you're charging the customer a Setup Fee of $1000 and you want to split the charge into 10 installments. You can create a new addon or edit an existing addon with the price set for $100. While adding the addon to the subscription, the billing cycle will be 10, i.e., Total Charge = Unit price of the Addon x Billing Cycles.

Note

Setup Addons with Billing Cycle 

First step is to set up an addon with the additional charge you want to collect from your customers in installments.

After navigating to Product Catalog > Addons, you can either create a new recurring addon with the charge or modify an existing addon for that purpose.
Once the addon is set up, you need to link it to a new subscription or an existing subscription.

To add the addon to a new subscription, navigate to Subscriptions and click on Create New Subscription. You will find the option to fill in the details of an addon to the subscription. Here you choose the addon and mention the billing cycle as well.

The addon will be added to the invoice of the new subscription. As the term progresses and more invoices are generated, the billing cycle will decrement to become zero and the addon will be removed after.

Now, to add the charge to an existing subscription, locate the subscription and click on Change Subscription.

You can choose the addon, mention the billing cycle and make it a part of the subscription.

For the existing subscriptions, when an addon is added, a prorated invoice is generated based on the subscription term. The prorated period will be considered as one billing cycle as far as the add-on is concerned.
If you add a billing cycle to an existing addon linked to a subscription, no charge will be raised. However, the billing period will decrement and the addon will be removed when the billing cycle becomes zero.

Note
  • Billing Cycle for Addons can be added/updated only via UI.
  • If there is a change of term for the subscription (for example, you change the subscription from monthly to quarterly) and the change is done via API, please ensure that the Billing Cycle of the Addon is updated as well. If not, the billing cycle will be reset to ‘forever', i.e., the customer will be charged for the addon indefinitely.

Subscription Cancellation 

When a subscription is canceled, the addon linked to the subscription will be disabled till reactivation. There are two scenarios to be taken into account as far as the reactivation of the subscription is considered:

  1. In-term Reactivation: If the subscription is reactivated before the end of the subscription term, the billing cycles of the addons will be maintained.
  2. Out-of-term Reactivation: If the subscription is reactivated after the end of the subscription term, the billing cycle of the addon will be reset to ‘forever', i.e., the customer will be charged for the addon indefinitely. Using ‘Change Subscription' option, you can update the billing cycle of the addon after reactivation.

Advance Invoice 

You can pay for the Addon upfront using Advance Invoice option. Payment made with Advance invoice can cover the entire billing cycle of the addon or can cover partially as well.

If the payment covers the whole term, billing cycle will decrement with time and the addon will be deactivated when it hits zero.

Say, an advance invoice was raised for a subscription with subscription's billing cycle set as 6. The subscription has an addon with a billing cycle set as 4. This will cover the entire payment for the addon in one shot and the addon will be deactivated when the billing cycle decrements to zero.

However, if the advance invoice does not cover the entire addon charge, the payment for the remaining billing cycles will be raised with the upcoming invoices.

Say, an advance invoice was raised for 2 out of 4 billing cycles for the addon. The rest of the charge will be raised in the remaining of the invoices.

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