Search the Aria Knowledgebase for
User Documentation, APIs, SDKs, and more!

 

Home > User Documentation > Product Catalog > Working with Plans > Proration

Proration

Table of contents

Overview

Proration is the process by which Aria determines charges or credits that should apply when a customer subscribes to a new plan, cancels a plan, or switches between plans in the middle of a billing cycle.

To determine prorated charges or credits, Aria calculates the daily cost of a plan's charges based on the number of days in the current billing cycle, then multiplies the daily cost by the applicable number of days remaining in the billing cycle. The number of days in a month varies from 28-31 depending on the month in question.

Example

For Plan A that costs $30/month, the daily cost would be $1 for a 30-day period. For Plan B that costs $60/month, the daily charge would be $2 for a 30-day period. As a result, if a customer who is billed on the 15th of every month switched from Plan A to Plan B on 4/27/15, that customer would have already consumed $12 in charges and would be owed an $18 credit for Plan A. In addition, the customer would owe $36 for Plan B. The end result, with full proration, would be an $18 balance ($36 charge -$18 credit). The customer would then be charged the full amount of $60 for Plan B on 5/15/15.

When a customer subscribes to a new plan, cancels a plan, or switches between plans in the middle of a billing cycle, you can select any of the following options:

  • (De-)Assign on Anniversary
  • (De-)Assign I mmediately

(De-)Assign on Anniversary

The plan is assigned or canceled on the paid through date of the customer's current plan or on the customer's anniversary day*, depending on the plan type and whether a plan is being assigned, canceled, or switched (plan assignment directive 1 in API calls).  The anniversary day is the day each month that falls on the same day as a customer's billing date. This day occurs every month even if the customer is not subscribed to a monthly plan. The anniversary day is determined at account registration time.

If a customer registers for an account and subscribes to an annual master plan on 1/15/15, that customer's anniversary day will be on the 15th of every month going forward (2/15/15, 3/15/15, 4/15/15, etc.

(De-)Assign Immediately

The plan is assigned or canceled immediately and you can specify how you want to perform proration:

  • Default Proration: Proration will be performed or not performed depending on your Aria implementation. If proration is performed, the customer will be charged or credited depending on the result of the proration (plan assignment directive 2 in API calls).
  • No Proration: The customer will not be charged or credited regardless of the result of the proration (plan assignment directive 3 in API calls).
  • Full Proration: The customer will be charged or credited depending on the result of the proration (plan assignment directive 4 in API calls).
  • Charge Proration ONLY: If the proration results in a charge, the customer will be charged. If the proration results in a credit, the customer will not be credited. (Plan assignment directive 5 in API calls. Does not apply when canceling a supplemental plan.)
  • Credit Proration ONLY: If the proration results in a credit, the customer will be credited. If the proration results in a charge, the customer will not be charged. (Plan assignment directive 6 in API calls. Does not apply when assigning a supplemental plan.)

 


You must to post a comment.
Last modified
21:00, 20 Jul 2015

Tags

Classifications

This page has no classifications.