This article outlines some of the frequently asked questions regarding subscription billing's pro-rated charges. Including what does it mean, when does it occur, and how is it calculated.
What is pro-rated (pro-rata)?
Pro-rated means in proportionality to some factor that can be exactly calculated. Specific to the context of subscription services, it means the proportional cost for how much time you have left in your subscription cycle.
For example, if you started an annual subscription with 5 user seats or licenses on January 1st, you would’ve been charged for all 5 user seats, paying for the full year’s period. If you then add 2 user seats on July 1st that year, you would be charged for 6 month’s worth of the subscription cost for the 2 additional user seats. Essentially, July to January next year or half of the full year’s subscription cost. Finally, when renewal comes January 1st next year, you will be charged for 7 user seats for the next year’s period.
When do pro-rated charges occur?
As new employees join your company, you may need to add them as users to your iAuditor Premium subscription. If you have no more available user seats or licenses, you will be charged a pro-rated amount for each new user seat that gets added. You can always add user seats or licenses in advance if you need to prepare for new users to be added.
How is the pro-rated amount calculated?
We utilize a billing platform to facilitate subscription payments, which calculates the pro-rated charges accordingly. If you have any questions regarding a subscription charge, please contact our customer support team for assistance.
Can I calculate the pro-rated amount before adding user seats?
No, but you can contact our customer support team. They will be able to provide an estimate, as charges vary depending on the exact date and time new user seats are added.
What happens when I free up user seats or licenses?
It depends on how you are billed for your subscription.
For organizations on our monthly subscription, each user seat you free up by deactivating or removing users automatically decreases the user seat as well. If the decrease takes place during the monthly subscription period, the subscription will be credited with a prorated amount proportional to the days left in the period.
For organizations on our annual subscription, freeing up user seats by deactivating or removing users will only leave the user seats available for new users to fill them. If you need to, you can reduce the number of user seats 28 days before renewals, or contact our customer support team if outside of the 28 days.
Please note that annual subscription charges outside of 30 days are not subject to credit or refund.