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Usage Rating

Zuora

Usage Rating

Overview

If you include the charge type of Usage in your bill run, Zuora will pick up the usage data you have uploaded for the corresponding usage charges and calculate the amounts your customers need to pay. This process is how usage rating works in Zuora Billing generally.

Usage rating and billing period

Usage rating is closely related to the status of a billing period, open or closed. A billing period is open before a bill run is triggered and an invoice is generated for that billing period. After a bill run is triggered and an invoice is generated for that billing period, it is closed.

The determination of the billing period is different for on-demand rating. Check here for more details.

If the start date of a usage record falls into one billing period and that billing period is open when you add the usage data, the usage data is picked up for rating for that billing period in the next bill run.

You can still upload usage data for a closed billing period, but such data will not be picked up for rating in the next bill run.

Example

Below is an example to explain the relationship between usage rating and billing period.

  • Charge name: Charge 1
  • Charge type: Usage
  • Billing cycle day: 5th of the month
  • Billing period: monthly
  • Usage data uploaded:
    • Start date: 07/01/2021
    • End date: 07/31/2021

Scenario 1: Usage data is uploaded when a billing period is open and gets processed.

  • Bill run date: 07/08/2021
  • Bill run target date: 07/05/2021
  • Billing period: 06/05/2021 – 07/04/2021
  • Usage data upload date: 07/01/2021

The start date of the usage data (07/01/2021) falls into the billing period of 06/05/2021 – 07/04/2021. And the billing period is still open when the usage data is uploaded. Therefore, this usage data will be rated and included in the corresponding invoice.

Scenario 2: Usage data is uploaded when a billing period is closed and remains pending.

  • Bill run date: 07/08/2021
  • Bill run target date: 07/05/2021
  • Billing period: 06/05/2021 – 07/04/2021
  • Usage data upload date: 07/31/2021

The start date of the usage data (07/01/2021) falls into the billing period of 06/05/2021 – 07/04/2021. But the billing period is closed when the usage data is uploaded. Therefore, this usage data will not be rated and included in any invoices. It will remain in pending status.

Notes on usage charges

  • The billing timing for usage charges is always in arrears. For example, you upload a usage record with a start date of 07/01. If you trigger a bill run with a target date of 07/01, no invoices will be generated from this bill run.
  • After a usage charge is invoiced, the usage charge can only be updated or removed from the subscription later than its last invoice date. This behavior is different from recurring charges or one-time charges.