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Knowledge Center > Billing and Payments > Billing Settings > Define Billing Rules

Define Billing Rules

Use the Billing Rules page to define your company's billing policies concerning proration, billing in advance, billing in arrears, and billing for individual or aggregated usage. Click your username at the top right and navigate to Billing > Define Billing Rules to configure the following billing rules:

Enable credit back for removing or canceling one time charges?

Use this setting to specify whether to create a credit when you remove or cancel one-time charges. 

See Proration Credit for information.

Prorate recurring charges for partial period?

This feature is in Limited Availability. If you wish to have access to the feature, submit a request at Zuora Global Support

You can choose whether or not to prorate for partial quarterly, semi-annual or annual billing periods.

The option Prorate recurring charges for partial period? is set to Yes by default, and will prorate recurring charges for any periods less than the billing period.   If you have this setting enabled in your tenant, you can disable proration for partial periods by selecting No.

This setting works in combination with the 'Bill recurring charges for partial month (with monthly based billing periods)? ' setting.

See Proration for information on how proration can affect subscriptions.

Bill recurring charges for partial month? (with monthly based billing periods)?

As well as proration for partial period, you can choose whether or not to bill recurring charges for any periods less than a month with the 'Bill recurring charges for partial month (with monthly based billing periods)?' option. 

This setting works in combination with the 'Prorate recurring charges for partial period? ' setting.

See Proration for information on how proration can affect subscriptions.

Bill recurring charges for partial week (with weekly based billing periods)?

You can choose whether to bill recurring charges for partial weekly billing periods. If this billing rule is set to Yes (the default), Zuora will prorate recurring charges for any periods less than a week. 

This setting works in combination with the Prorate recurring charges for partial period? setting.

See Proration for information on how proration can affect subscriptions.

Bill usage charges for partial months? (with monthly based billing periods)?

Usage charges are not prorated in the same way as recurring charges. If Prorate usage charges for partial month? is set to Yes (the default), all usage charges that occur within a prorated month will be billed. If set to No, then no usage charges that occur within a prorated billing period are billed.

Bill usage charges for partial week (with weekly based billing periods)?

Usage charges are not prorated in the same way as recurring charges. If Prorate usage charges for partial week (with weekly based billing periods)? is set to Yes (by default), all usage charges that occur within a prorated week will be billed. If set to No, then no usage charges that occur within a prorated week are billed.

When prorating a month, assume 30 days in a month or use actual days?

This setting lets you choose to calculate charges using the actual number of days in the month for a proration or always use thirty days in a month for a proration. To use the actual number of days in the month of a proration, choose Use actual number of days. To always use thirty days in a month for a proration, choose Assume 30 days in a month.

See Proration for more information.

When prorating periods greater than a month, prorate by month first, or by day?

If you are billing annually, semi-annually or quarterly and you are prorating, you can choose 'Prorate by month first' for proration to be calculated based on whole months first, with the remaining days prorated over a month, or choose 'Prorate by day' for the proration to be based on the exact number of days.

This setting works in combination with the 'When prorating a month, assume 30 days in a month or use actual days? ' setting.

See Proration for more information.

Support Bill Run Auto-Post?

This rule enables auto-post options for selection when creating a bill run. You must enable this rule if you want to use auto-post options when creating bill runs from the Zuora UI or from the Zuora API.

Once enabled, the following options appear on the Create Bill Run page:

  • Auto-post billing documents (invoices, credit memos, and debit memos) upon completion of bill runs.
  • Email billing documents after auto-post is complete.

Select Yes to enable the auto-post for billing documents.

Default Bill Run to Auto-Post?

Select whether to automatically post billing documents (invoices, credit memos, and debit memos) that complete successfully. This option appears only after changing the Support Bill Run Auto-Post to Yes.

Include invoices with negative totals in the Account Balance (included associated Debit Memos)?

Specify whether to include invoices with negative totals. If you select No, only invoices with positive totals will be included in the account balance. 

How should errors be handled when generating multiple invoices for a single account via bill run?

The default option "Terminate processing of all invoices" causes a bill run for an account to halt if any single subscription in that account produces an error in processing.

The option "Skip error and continue processing" allows the bill run for an account to complete despite any processing errors in individual subscriptions that may occur. Enabling this option may result in a performance increase for large bill runs.

This option increases performance for Zuora users who have many accounts with multiple subscriptions each. It is only for those users who already enable the "Invoice The Subscription Separately" option for subscriptions. If you don't invoice your customers for each subscription separately, have a large number of accounts, or haven't experienced any performance issues, then you are advised not to enable "Skip error and continue processing"

See Usage for related information. 

Round and determine a price for usage records individually when rating usage charges?

This feature is in Limited Availability. If you wish to have access to the feature, submit a request at Zuora Global Support

When rating usage charges, you can choose whether to calculate a price for usage records in a billing period or for each usage record. 

Calculate a Price for Usage Records in a Billing Period 

If you set this billing rule to No, by default, the price is calculated for usage records in a billing period. 

Calculate a Price for Each Usage Record

If you set this billing rule to Yes, the price is calculated for each usage record.

This option allows you to show each usage record and its charge as a separate line item in the Usage Detail section of the invoice. You can also view the charge amount for each usage record in the Amount field of the exported Processed Usage data source. Because the charge is rounded for each usage record, rather than once for the group total, the resulting totals might be affected. The potential difference will be larger in cases where a customer has a large number of usage records. 

Use this setting for unit-based, volume pricing, or tiered pricing charge models with this option. Do not use this option with the following charge models: 

  • Tiered pricing with on-demand usage rating
  • Flat fee pricing
  • Overage pricing (Rolling Window and Rollover)
  • Tiered with overage pricing

Example Scenario

Suppose you provide the following rate plan:

  • UOM: Each
  • Billing Period: Month
  • Billing Day: Subscription Start Day
  • Rating Group: By Usage Start Day
  • Price Table:

    Tier

    From

    To

    List Price

    Price Format

    1

    0

    10

    $1

    Per Unit

    2

    10.1

    -

    $0.9

    Per Unit

Later, two usage records are uploaded:

Records Start Date Quantity

Record 1

1/1/2018

8

Record 2

1/1/2018

5

The following sections describe how to calculate charge amount based on two typical charge models: volume pricing and tired pricing charge models.

Calculating Charge Amount with Volume Pricing Charge Model

This example shows you how to calculate usage charges on volume pricing based when different options of Round and determine a price for usage records individually when rating usage charges? billing rule is selected.

If this billing rule is set to No:

  1. Calculate the total quantity on the same usage start date. The total quantity on 1/1/2018 is 13.
  2. Calculate charge amount on the same usage start date. Charge amount on 1/1/2018 is $11.7 =(13*$0.9).

If this billing rule is set to Yes:

  1. Calculate the total quantity on the same usage start date. The total quantity on 1/1/2018 is 13.
  2. Check the price table. The total quantity falls into Tier 2.
  3. Calculate charge amount for each usage record. 
    • Record 1: $7.2 =(8*$0.9)
    • Record 2: $4.5 =(5*$0.9)
  4. Calculate charge amount on the same usage start date. Charge amount on 1/1/2018 is $11.7.
Calculating Charge Amount with Tiered Pricing Charge Model

This example shows you how to calculate usage charges on tiered pricing based when different options of Round and determine a price for usage records individually when rating usage charges? billing rule is selected.

If this billing rule is set to No:

  1. Calculate the total quantity on the same usage start date. The total quantity on 1/1/2018 is 13.
  2. Calculate charge amount on the same usage start date. Charge amount on 1/1/2018 is $12.7 =(10*$1+3*$0.9).

If this billing rule is set to Yes:

  1. Calculate charge amount for each usage record:
    • Record 1: $8 =(8*$1)
    • Record 2: $4.7 =(2*$1+3*$0.9)
  2. Calculate charge amount on on the same usage start date. Charge amount on 1/1/2018 is $12.7.

Include usage from child accounts when billing?

This feature is in Limited Availability. If you wish to have access to the feature, submit a request at Zuora Global Support

Select whether to include usage charges generated by child accounts when billing the parent account. See Aggregate the Usage Billing of Child Accounts for more information about this feature. 

Calculate taxes using information from Customer Account of:

You must have taxation enabled to use this rule. 

You can choose to calculate taxes based on the sold-to contact of the subscription owner or the invoice owner. All the account information of the specified contact, including tax information, such as tax exemption, is considered in the tax calculation. If you are using Avalara, value-added tax (VAT), company codes, and other Avalara tax information are also considered in the tax calculation.

You might choose to calculate taxes based on the account information of the invoice owner if the invoice owner is the reseller and the subscription owner is the end user.

By default, the subscription owner is used for calculating taxes.

Invoice/Credit Memo generation rule 

This feature is only available if you have the Advanced AR Settlement feature enabled. The Advanced AR Settlement feature is in Limited Availability. If you wish to have access to the feature, submit a request at Zuora Global Support

Select whether to split all negative charges to credit memo (default) or to create credit memos only for net negative billing.

See Rules for Generating Invoices and Credit Memos for detailed information.

Preserve snapshot of bill-to and sold-to contacts when billing documents are posted? 

Select whether to take snapshots for the bill-to contact and sold-to contact when the invoices are posted.

If you enable this billing rule, Zuora captures snapshots automatically when invoices are posted. The contact snapshots are available for queries using the SOAP API and Data Sources:

Last modified
23:30, 25 May 2017

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