account, Hierarchy, proration, calculation
Account hierarchy and proration calculation
36981257
2023-01-23T11:57:10Z
2023-01-30T12:37:44Z
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Account hierarchy and proration calculation
Account hierarchy and proration calculation
Scope
How is proration calculated in the account hierarchy setup?
Solution**
Use Case:
- Customer 1 - Create a subscription for this customer which is paid with card 1.
- Customer 2 - Add a payment method for this customer. Ex. Card 2.
- Link both the customers. Customer 1 is the child and customer 2 is the parent.
- Now when customer 1's subscription is upgraded, credits are not applied to the prorated invoice because the refund should go back to who paid the invoice. In this case, the invoice was paid by customer 1 using card 1.
- So customer 2 will be charged the prorated amount which is a result of the upgrade, and a credit note is created for customer 1. This will remain as refundable credits at the customer level for customer 1 or can be refunded back to customer 1 from the dashboard by the merchant.
- Once the prorated invoice for the upgrade is paid by the parent (customer 2), if an upgrade occurs once again - this time credits will be applied to the newly generated prorated invoice since customer 2 paid for the entire invoice.
In conclusion, this is happening because the subscription was created and payment was made for the invoice prior to linking the customer records and establishing a relationship between them. This will not occur if the subscription is created and paid after linking the customer records.
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