Billing scenarios for one-time and select recurring purchases in new commerce experience

  • Article

Appropriate roles: Admin agent | Billing admin | Helpdesk agent | Sales agent

Note

For a list of legacy billing scenarios, see Common billing scenarios for legacy CSP program partners working in Partner Center.

What is a new commerce billing cycle or billing period?

A new commerce billing cycle, or billing period, is one full calendar month. You pay based on the billing term and plan you choose.

You get your invoice and reconciliation data from Partner Center or via APIs in the next month. For example, if the billing period is January 1 to 31, you receive your invoice and reconciliation data for January between February 6 and 8.

What is a new commerce charge cycle?

A new commerce charge cycle is the number of days you pay for a subscription. It's not the same as a billing period or a calendar month. It depends on how many days there are in the month when you buy, renew, or change your subscription.

For example, say you bought an annual Microsoft Office subscription on February 21, 2022, with a monthly billing plan. Your first charge cycle was from February 21 to March 20, 2022. The charge cycle ends the day before the same date of the next month or year or billing term, depending on how frequently you pay.

In this example, the first charge cycle has 28 days because February has 28 days (except in leap years). The second charge cycle has 31 days because March has 31 days. It goes from March 21 to April 20. The third charge cycle has 30 days because April has 30 days. It goes from April 21 to May 20. A recurring charge cycle always starts on the same day as when you bought or renewed your subscription.

Tip

To end a subscription with another subscription or a calendar month, see Align subscription end dates.

How are one-time and recurring charges calculated?

Important

To reconcile, include these billing details: Charge Start Date, Charge End Date, Effective Unit Price, Billable Quantity, Billing Frequency, Subscription Start Date, Subscription End Date, and Amount.

For more information, see CSP one-time purchase reconciliation file fields.

Let's say, on June 18, 2020, you bought 10 monthly licenses of Microsoft 365 Business Standard subscription for a unit price of EUR 10.08.

Here's how your June billing period reconciliation line items look when you receive them in July. It has one billing line with the purchase details.

Order Date Charge Start Date Charge End Date Charge Type Effective Unit Price Billable Quantity Amount
June 18, 2021 June 18, 2021 July 17, 2021 new 10.08 10 100.8

When you renew your subscription, you get a new billing line item or transaction. It has the ChargeType "renew" and the ChargeStartDate "July 18, 2021."

Order Date Charge Start Date Charge End Date Charge Type Effective Unit Price Billable Quantity Amount
July 18, 2021 July 18, 2021 August 17, 2021 renew 10.08 10 100.8

For annual subscription, you pay EUR 100.8 monthly for a year, starting from July. From August, the ChargeType for those charges are labeled as "cycleCharge".

Order Date Charge Start Date Charge End Date Charge Type Effective Unit Price Billable Quantity Amount
July 18, 2021 July 18, 2021 August 17, 2021 cycleCharge 10.08 10 100.8

A single billing line appears in your June reconciliation data if you prepay your annual subscription.

Order Date Charge Start Date Charge End Date Charge Type Effective Unit Price Billable Quantity Total
June 18, 2021 June 18, 2021 June 17, 2022 new 120.96 10 1,209.6

Your reconciliation data shows how much you pay for your subscriptions.

Important

Microsoft 365 E5 is a single product that offers both telecommunication and non-telecommunication services. When you buy Microsoft 365 E5, you see two billing line items or transactions in your reconciliation data to separate revenues: one for telecommunication charges and one for non-telecommunication charges.

How do I differentiate between one-time and recurring payments in a reconciliation file

One-time payment:

  • Charge Start Date and Charge End Date match the Subscription Start Date and Subscription End Date.
  • Billing Frequency is blank.

Recurring payment or billing plan:

  • Charge Start Date and Charge End Date are a month apart. The Billing Frequency is "Monthly."
  • Charge Start Date and Charge End Date are one year apart. The Billing Frequency is "Annual."

How to calculate the costs of a product or subscription with both fixed fee and pay-as-you-go charges?

Maximizing the benefits of your subscription-based products is easy and straightforward. Some subscription-based products have a fixed number of prepaid units at a fixed price. You pay for any extra usage at a pay-as-you-go rate. For example, these products:

  • Microsoft 365 subscription: Pay USD 10 per month and get 100 minutes of calls. Extra minutes are 10 cents each.

  • SendGrid product: Pay USD 10 per month and send 100 emails. Extra emails are 10 cents each.

Going over 150 minutes of calls or emails per month costs you extra.

To calculate costs for these subscriptions using the daily rated usage and invoice reconciliation data, follow these steps:

  1. The BillingPreTaxTotal shows your daily pay-as-you-go charges. For example, if you use 50 extra minutes at 10 cents per minute, you pay USD 5 for that day.

  2. Verify your monthly pay-as-you-go charges by comparing the Total in the invoice reconciliation data with USD 5. The BillableQuantity should be 50 units.

  3. The Total shows your subscription cost based on your billing plan. For monthly plans, you pay USD 10 each month.

  4. To get the total cost, look at the Product and SKU IDs in the invoice reconciliation data. You might see two line items for fixed fees and pay-as-you-go costs. The total should be USD 15.

These steps help you manage your subscription costs and use them wisely.

How do I determine the product category?

Use these methods to find the product category in the reconciliation data. They work for most transactions, except in rare cases.

Condition Product Category
PublisherName says "Microsoft" or "Microsoft Corporation" First-party product
PublisherName isn't "Microsoft" or "Microsoft Corporation," and "PublisherID" isn't empty. Non-Microsoft or Marketplace product
TermAndBillingCycle has the keyword "Reservation." Azure reservation
TermAndBillingCycle has the keyword "Savings Plan." Azure savings plan
TermAndBillingCycle has the keyword "Subscription."
If the word "Subscription" is missing, use the SKU name instead, such as "SQL Server" or "Windows Server."		 Software subscription
TermAndBillingCycle has the phrase "one-month," "one-year," or "three-year." License-based. However, double-check to confirm.
TermAndBillingCycle is blank, and "ChargeEndDate" is empty. Perpetual software
SubscriptionDescription says "Azure plan." Azure plan
Remaining conditions Use Azure plan as the name for the remaining product category. You can give each subscription a different name if you want. Make sure nothing is missing.

How do I find the billing term in a reconciliation file?

TermAndBillingCycle can have different texts depending on the subscription. There's no standardized text to describe them.

The billing term is how long your subscription lasts. Look at the subscription start and end dates to see the term. The billing plan is how often you pay. Look at the charge start and end dates to see the plan.

See the examples:

TermAndBillingCycle Subscription Start Date Subscription End Date Charge Start Date Charge End Date
One-year commitment for monthly/yearly billing April 15, 2021 April 14, 2022 April 15, 2021 May 14, 2021
One-year term duration April 22, 2021 April 21, 2022 April 22, 2021 April 21, 2022
One-month commitment for monthly billing April 10, 2021 May 9, 2021 April 10, 2021 May 9, 2021
Three-year commitment for monthly/yearly billing May 25, 2021 May 24, 2024 May 25, 2021 May 24, 2022

Monthly term subscription expiration dates on special cases

Here's when monthly subscriptions expire when you buy near the end of a month:

When you buy on the last day of a month

If you buy a monthly subscription on the last day of a month, your subscription and charge end on the:

  • 30th day of the next month if that month has 31 days.
  • 29th day of the next month if that month has 30 days.
  • 28th day of the next month if that month has 28 days (February in a leap year).
  • 27th day of the next month if that month has 27 days (February in a nonleap year).

Note

The line items are unrelated to each other and use Coordinated Universal Time (UTC) for dates. Subscription charges start on the last day of each month and stop one day before the next month. February can have 28 or 29 days, depending on the year.

Reconciliation line items of a monthly subscription:

Billing Term Order Date Charge Type Subscription Start Date Subscription End Date Renew Date Charge Start Date Charge End Date
Monthly January 31, 2021 new January 31, 2021 February 27, 2021 February 28, 2021 January 31, 2021 February 27, 2021
Monthly February 28, 2021 new February 28, 2021 March 27, 2021 March 28, 2021 February 28, 2021 March 27, 2021
Monthly May 31, 2021 new May 31, 2021 June 29, 2021 June 30, 2021 May 31, 2021 June 29, 2021
Monthly June 30, 2021 new June 30, 2021 July 29, 2021 July 30, 2021 June 30, 2021 July 29, 2021
Monthly July 31, 2021 new July 31, 2021 August 30, 2021 August 31, 2021 July 31, 2021 August 30, 2021

Reconciliation line items of an annual subscription with a monthly billing plan:

Billing Term Billing Plan Order Date Charge Type Subscription Start Date Subscription End Date Renew Date Charge Start Date Charge End Date
Annual Monthly January 31, 2021 new January 31, 2021 January 30, 2022 January 31, 2022 January 31, 2021 February 27, 2021
Annual Monthly February 28, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 February 28, 2021 March 30, 2021
Annual Monthly March 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 March 31, 2021 April 29, 2021
Annual Monthly April 30, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 April 30, 2021 May 30, 2021
Annual Monthly May 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 May 31, 2021 June 29, 2021
Annual Monthly June 30, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 June 30, 2021 July 30, 2021
Annual Monthly July 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 July 31, 2021 August 30, 2021
Annual Monthly August 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 August 31, 2021 September 29, 2021
Annual Monthly September 30, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 September 30, 2021 October 30, 2021
Annual Monthly October 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 October 31, 2021 November 29, 2021
Annual Monthly November 30, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 November 30, 2021 December 30, 2021
Annual Monthly December 31, 2021 cycleCharge January 31, 2021 January 30, 2022 January 31, 2022 December 31, 2021 January 30, 2022

When you buy on the day before the last day of a month

If you buy a monthly subscription on the day before the last day of a month, your subscription and charge end on the:

  • 29th day of the following month if it has 31 days.
  • 28th day of the following month if it has 30 days.
  • 27th day of the following month if it has 28 days (February).

Note

The line items are unrelated to each other and use Coordinated Universal Time (UTC) for dates. Subscription charges start on the last day of each month and stop one day before the next month. February can have 28 or 29 days, depending on the year.

Reconciliation line items of a monthly subscription:

Billing Term Order Date Charge Type Subscription Start Date Subscription End Date Renew Date Charge Start Date Charge End Date
Monthly January 30, 2021 new January 30, 2021 February 27, 2021 February 28, 2021 January 30, 2021 February 27, 2021
Monthly February 27, 2021 new February 27, 2021 March 26, 2021 March 27, 2021 February 27, 2021 March 26, 2021
Monthly May 30, 2021 new May 30, 2021 June 29, 2021 June 30, 2021 May 30, 2021 June 29, 2021
Monthly June 29, 2021 new June 29, 2021 July 28, 2021 July 29, 2021 June 29, 2021 July 28, 2021
Monthly July 30, 2021 new July 30, 2021 August 29, 2021 August 30, 2021 July 30, 2021 August 29, 2021

Reconciliation line items of an annual subscription with a monthly billing plan:

Billing Term Billing Plan Order Date Charge Type Subscription Start Date Subscription End Date Renew Date Charge Start Date Charge End Date
Annual Monthly January 30, 2021 new January 30, 2021 January 29, 2022 January 30, 2022 January 30, 2021 February 26, 2021
Annual Monthly February 27, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 February 27, 2021 March 29, 2021
Annual Monthly March 30, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 March 30, 2021 April 28, 2021
Annual Monthly April 29, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 April 29, 2021 May 29, 2021
Annual Monthly May 30, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 May 30, 2021 June 28, 2021
Annual Monthly June 29, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 June 29, 2021 July 29, 2021
Annual Monthly July 30, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 July 30, 2021 August 29, 2021
Annual Monthly August 30, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 August 30, 2021 September 28, 2021
Annual Monthly September 29, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 September 29, 2021 October 29, 2021
Annual Monthly October 30, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 October 30, 2021 November 28, 2021
Annual Monthly November 29, 2021 cycleCharge January 30, 2021 January 29, 2022 January 30, 2022 November 29, 2021 December 29, 2021
Annual Monthly December 30, 2021 cycleCharge January 31, 2021 January 30, 2022 January 30, 2022 December 30, 2021 January 29, 2022

How are licenses added or removed?

Find out how we adjust the charges for license-based products when you update the license count.

Let's say, you bought 10 licenses of a monthly "Microsoft 365 Business Standard" subscription on June 18, 2021. The unit price of each license is EUR 10.08. You added two more licenses on June 20.

Here are the reconciliation line items for the June billing period:

Order Date Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Total
June 18, 2021 new 10.08 June 18, 2021 July 17, 2021 10.08 10 100.8
June 20, 2021 addQuantity 10.08 June 20, 2021 July 17, 2021 -9.408 10 -94.08
June 20, 2021 addQuantity 10.08 June 20, 2021 July 17, 2021 9.408 12 112.89

To change the number of licenses, we follow two steps at once:

  • Refund (wipe): a refund for original number of licenses from the day you change them until the end of the charge cycle.
  • Charge (recreate): a charge for the new number of licenses for the same period.

This formula shows the EffectiveUnitPrice, which is your price. You might also get adjustments or discounts that can lower your final price, but we didn't include them here for simplicity.

EffectiveUnitPrice = UnitPrice / days in the charge cycle * billing days.

Billing days are counted from when an event occurs until the charge cycle ends.

Note

Monthly billing varies based on the number of days in a month. For example, June has 30 days and August has 31 days. Annual billing is fixed at 365 days, except in leap years when it adds one extra day.

  • In this example, the first line item is an EUR 100.8 charge for using 10 licenses from June 18 to July 17, or 30 days. The unit price of each license is EUR 10.08. The EffectiveUnitPrice and UnitPrice are the same when the charge cycle has the same number of days as the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08) * BillableQuantity (10) = 100.8. To simplify the total cost, we didn't include taxes and exchange rates.

  • The second line item is a refund of EUR 94.08 for 10 licenses unused for 28 days from June 20 to July 17. The EffectiveUnitPrice is adjusted based on the billable days.

    • Total (refund) = EffectiveUnitPrice (10.08 / 30 * 28) * BillableQuantity (10) = 94.08. To simplify the total cost, we didn't include taxes and exchange rates.

  • The third line item is a charge of EUR 112.8 for 12 licenses used for 28 days from June 20 to July 17. The EffectiveUnitPrice is adjusted based on the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08 / 30 * 28) * BillableQuantity (12) = 112.89. To simplify the total cost, we didn't include taxes and exchange rates.

Let's say, you remove four licenses on June 20. We then adjust the charges accordingly.

Reconciliation line items for June billing period after removing the licenses:

Order Date Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Total
June 20, 2021 removeQuantity 10.08 June 20, 2021 July 17, 2021 -9.408 12 -112.89
June 20, 2021 removeQuantity 10.08 June 20, 2021 July 17, 2021 9.408 8 75.26

  • The first line item is a refund of EUR 112.89 for 12 licenses unused for 28 days from June 20 to July 17. The EffectiveUnitPrice is adjusted based on the billable days.

    • Total (refund) = EffectiveUnitPrice (10.08 / 30 * 28) * BillableQuantity (12) = 112.89. To simplify the total cost, we didn't include taxes and exchange rates.

  • The second line item is an EUR 75.26 charge for eight licenses used for 28 days from June 20 to July 17. The EffectiveUnitPrice is adjusted based on the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08 / 30 * 28) * BillableQuantity (8) = 75.26. To simplify the total cost, we didn't include taxes and exchange rates.

How are the refunds calculated if I cancel a subscription?

Let's say, you bought 10 licenses of a monthly Microsoft 365 Business Standard subscription on July 15, 2021. The unit price of each license is EUR 10.0. You then canceled the subscription on July 17.

Here are the reconciliation line items for the July billing period after your cancellation:

Order Date Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Total
July 15, 2021 new 10.08 July 15, 2021 August 14, 2021 10.08 10 100.8
July 17, 2021 cancelImmediate 10.08 July 17, 2021 August 14, 2021 -9.42 10 -94.2

  • The first line item is a charge of EUR 100.8 for 10 licenses used from July 15 to August 14 for 31 days. The unit price per license is EUR 10.08. The EffectiveUnitPrice and UnitPrice are the same when the charge cycle has the same number of days as the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08) * BillableQuantity (10) = 100.8. To simplify the total cost, we didn't include taxes and exchange rates.

  • The second line item is a refund of EUR 94.2 for 10 licenses unused from July 17 to August 14 for 29 days. The EffectiveUnitPrice is prorated based on the billable days.

    • Total (refund) = EffectiveUnitPrice (10.08 / 31 * 29) * BillableQuantity (10) = 94.2. To simplify the total cost, we didn't include taxes and exchange rates.

Tip

Get a full refund if you cancel your subscription within 24 hours. Get a prorated refund depending on how long you use the service if you cancel later but still within seven days. You pay only for what you use.

Important

If you don't cancel within seven days, you get no refund and pay for the full subscription term, even if you don't use the product. See the new commerce cancellation policy.

You have two options to upgrade your subscription:

  • Full upgrade, switch all licenses of a subscription to a more advanced one.
  • Partial upgrade, switch only some of the licenses of a subscription to a more advanced one.

Full upgrade

Let's say, you bought 300 licenses of a Microsoft 365 Business Standard monthly subscription on June 18 for your customer Contoso. The unit price of each license is EUR 10.08. On June 25, you upgraded the subscription to Office 365 E1, as Contoso requested. The unit price of each license of the upgraded subscription is EUR 6.43.

After upgrading, we refund the base subscription and charge you only for the new one from the upgrade day to the end of the charge cycle. That makes you pay for what you use, and your billing is correct and transparent.

Reconciliation line items for June billing period after upgrade:

Order Date Product Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Total Subscription ID Reference ID
June 18, 2021 Microsoft 365 Business Standard new 10.08 June 18, 2021 July 17, 2021 10.08 300 3024 284b0ff0-0e74-4f65-cb23-f8ad95867994 7d71c595-4635-40d1-a9e2-b34e63b01764
June 25, 2021 Microsoft 365 Business Standard convert 10.08 June 25, 2021 July 17, 2021 -7.72 300 -2316 284b0ff0-0e74-4f65-cb23-f8ad95867994 12d33e18-061e-4040-ad77-fcd77c1a9943
June 25, 2021 Office 365 E1 convert 6.43 June 25, 2021 July 17, 2021 4.92 300 1476 284b0ff0-0e74-4f65-cb23-f8ad95867994 12d33e18-061e-4040-ad77-fcd77c1a9943

  • EffectiveUnitPrice = UnitPrice / days in the charge cycle * billing days. Billing days are counted from when an event occurs until the charge cycle ends.

  • The first line item is a charge of EUR 3,024 for the Microsoft 365 Business Standard subscription used for the whole month from June 18 to July 17. The unit price of a license is EUR 10.08. The EffectiveUnitPrice and UnitPrice are the same when the charge cycle has the same number of days as the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08) * BillableQuantity (300) = 3,048. To simplify the total cost, we didn't include taxes and exchange rates.

  • The second line item is a refund of EUR 2,316 for the same subscription unused from June 25 to July 17 for 23 days. The EffectiveUnitPrice is prorated based on the billable days.

    • Total (refund) = EffectiveUnitPrice (10.08 / 30 * 23) * BillableQuantity (300) = 2,316. To simplify the total cost, we didn't include taxes and exchange rates.

  • The third line item is a charge of EUR 1,476 for the new subscription used from June 25 to July 17 for 23 days. The EffectiveUnitPrice is prorated based on the billable days.

    • Total (Charge) = EffectiveUnitPrice (6.43 / 30 * 23) * BillableQuantity (300) = 1,476. To simplify the total cost, we didn't include taxes and exchange rates.

Note

To upgrade to a new advanced subscription, we use charge type "convert." If you already have an advanced subscription, we use charge type "moveQuantity."

Partial upgrade

Let's say, you bought 300 licenses of a Microsoft 365 Business Standard monthly subscription on June 18 for your customer Contoso. The unit price of each license is EUR 10.08. On June 25, you upgraded 100 licenses of the subscription to Office 365 E1, as Contoso requested. The unit price of each license of the upgraded subscription is EUR 6.43.

After upgrading, we refund the base subscription and charge you only for the new one from the upgrade day to the end of the charge cycle. That makes you pay for what you use, and your billing is correct and transparent.

Reconciliation line items for June billing period after upgrade:

Order Date Product Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Total Subscription ID Reference ID
June 18, 2021 Microsoft 365 Business Standard new 10.08 June 18, 2021 July 17, 2021 10.08 300 3024 284b0ff0-0e74-4f65-cb23-f8ad95867994 7d71c595-4635-40d1-a9e2-b34e63b01764
June 25, 2021 Microsoft 365 Business Standard convert 10.08 June 25, 2021 July 17, 2021 -7.72 100 -772 284b0ff0-0e74-4f65-cb23-f8ad95867994 12d33e18-061e-4040-ad77-fcd77c1a9943
June 25, 2021 Office 365 E1 convert 6.43 June 25, 2021 July 17, 2021 4.92 100 492 6759acd5-a8a9-4402-94b7-803baa64a78e 12d33e18-061e-4040-ad77-fcd77c1a9943

  • EffectiveUnitPrice = UnitPrice / days in the charge cycle * billing days. Billing days are counted from when an event occurs until the charge cycle ends.

  • The first line item is a charge of EUR 3,024 for the Microsoft 365 Business Standard subscription used for the whole month from June 18 to July 17. The unit price of each license is EUR 10.08. The EffectiveUnitPrice and UnitPrice are the same when the charge cycle has the same number of days as the billable days.

    • Total (Charge) = EffectiveUnitPrice (10.08) * BillableQuantity (300) = 3,048. To simplify the total cost, we didn't include taxes and exchange rates.

  • The second line item is a refund of EUR 772 refund for 100 licenses of the base subscription unused from June 25 to July 17 for 23 days . The EffectiveUnitPrice is prorated based on the billable days.

    • Total (refund) = EffectiveUnitPrice (10.08 / 30 * 23) * BillableQuantity (100) = 772. To simplify the total cost, we didn't include taxes and exchange rates.

  • The third line item is a charge of EUR 492 for the upgraded subscription used from June 25 to July 17 for 23 days. The EffectiveUnitPrice is prorated based on the billable days.

    • Total (Charge) = EffectiveUnitPrice (6.43 / 30 * 23) * BillableQuantity (100) = 492. To simplify the total cost, we didn't include taxes and exchange rates.

Note

The negative charge adjusts the cost for the rest of the charge cycle.

Note

To upgrade to a new advanced subscription, we use charge type "convert." If you already have an advanced subscription, we use charge type "moveQuantity."

To see the transactions or billing line items from your subscription upgrade, you need two IDs: SubscriptionId and ReferenceId. Find the ReferenceId that matches your base SubscriptionId. Then use the ReferenceId to link all the related transactions or billing line items.

How do I reconcile after I convert a trial version to a paid subscription?

Let's say, you bought 25 "Dynamics 365 Guides" license as a free trial on June 25, 2021. They expire after one month. You can switch to the paid version whenever you want during or after the trial.

Reconciliation line items for the June billing period after switching to paid subscription:

Order Date Charge Type Unit Price Charge Start Date Charge End Date Effective Unit Price Billable Quantity Product Qualifier Total
June 25, 2021 new 0 June 25, 2021 July 24, 2021 0 25 ["Trial"] 0
June 25, 2021 convert 0 June 25, 2021 July 24, 2021 0 25 ["Trial"] 0
June 25, 2021 convert 52.61 June 25, 2021 July 24, 2021 52.61 25 1,315.25

  1. The first line item is the purchase of the free trial subscription, which has no cost. Check the costs and the ProductQualifiers.

  2. You upgraded to the paid version the same day you started the trial. The second line item cancels the trial subscription.

  3. The third line item is a charge of EUR 1,315.25 for the paid subscription used from June 25, 2021, to July 24, 2021 for 30 days.

    • Total (Charge) = EffectiveUnitPrice (52.61 / 30 * 30) * BillableQuantity (25) = 1,315.25. To simplify the total cost, we didn't include taxes and exchange rates.

How do I find out the total number of licenses after several adjustments during a billing period?

Let's say, you bought 10 licenses of an annual Microsoft 365 Business Standard subscription with a monthly billing plan for your customer Contoso on March 5, 2022. After that you adjusted the license counts several times during the billing period as they needed.

  • Added 5 licenses on March 7 and 10 licenses on March 10.

  • Removed two licenses on March 12 and three licenses on March 14.

  • Added 10 licenses on March 25.

  • Upgraded five licenses to Office 365 E1 on March 27.

To calculate the total licenses for the billing period, follow these steps:

  1. Look for the transaction or line item with these details: ChargeType is "new," and ProductName or SkuName is "Microsoft 365 Business Standard." If you changed licenses after the first billing period, use ChargeType "cycleCharge" or "renew" instead.

  2. Find the OrderDate and SubscriptionId of that transaction or line item of step 1.

  3. Sum the BillableQuantity of all charge types that have a positive EffectiveUnitPrice from the order date onwards for the subscription ID.

  4. Sum the BillableQuantity of all charge types (except customerCredit) that have a negative EffectiveUnitPrice from the order date onwards for the subscription ID.

  5. Total licenses = (Sum of the quantities from step 3) - (Sum of the quantities from step 4).

Note

This method shows license totals for monthly billed subscriptions. For annual or one-time billed subscriptions, check each line item when they change.

Reconciliation line items in the March billing period after adjusting the license count:

OrderDate ProductName ChargeType UnitPrice BillableQuantity EffectiveUnitPrice Subtotal SubscriptionId ChargeStartDate ChargeEndDate ReferenceId
March 5, 2022 Microsoft 365 Business Standard new 12 10 12.00 120 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 5, 2022 April 4, 2022 7d71c595-4635-40d1-a9e2-b34e63b01764
March 7, 2022 Microsoft 365 Business Standard addQuantity 12 10 -11.23 -112.25 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 7, 2022 April 4, 2022 12d33e18-061e-4040-ad77-fcd77c1a9943
March 7, 2022 Microsoft 365 Business Standard addQuantity 12 15 11.23 168.38 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 7, 2022 April 4, 2022 12d33e18-061e-4040-ad77-fcd77c1a9943
March 10, 2022 Microsoft 365 Business Standard addQuantity 12 15 -10.06 -150.96 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 10, 2022 April 4, 2022 dc2a0a41-6a51-4837-8956-af5ffd92b094
March 10, 2022 Microsoft 365 Business Standard addQuantity 12 25 10.06 251.61 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 10, 2022 April 4, 2022 dc2a0a41-6a51-4837-8956-af5ffd92b094
March 12, 2022 Microsoft 365 Business Standard removeQuantity 12 25 -9.29 -232.25 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 12, 2022 April 4, 2022 2f8965ff-512b-4233-9a74-1f54a6ad71d0
March 12, 2022 Microsoft 365 Business Standard removeQuantity 12 23 9.29 213.67 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 12, 2022 April 4, 2022 2f8965ff-512b-4233-9a74-1f54a6ad71d0
March 14, 2022 Microsoft 365 Business Standard removeQuantity 12 23 -8.52 -195.87 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 14, 2022 April 4, 2022 73b3dc36-f36d-4bbf-af8f-30c9b73ac4f6
March 14, 2022 Microsoft 365 Business Standard removeQuantity 12 20 8.52 170.32 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 14, 2022 April 4, 2022 73b3dc36-f36d-4bbf-af8f-30c9b73ac4f6
March 25, 2022 Microsoft 365 Business Standard addQuantity 12 20 -4.26 -85.16 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 25, 2022 April 4, 2022 6759acd5-a8a9-4402-94b7-803baa64a78e
March 25, 2022 Microsoft 365 Business Standard addQuantity 12 30 4.26 127.74 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 25, 2022 April 4, 2022 6759acd5-a8a9-4402-94b7-803baa64a78e
March 27, 2022 Microsoft 365 Business Standard convert 12 10 -3.48 -34.8 284b0ff0-0e74-4f65-cb23-f8ad95867994 March 27, 2022 April 4, 2022 a11af6ef-8523-4eba-b1fa-fe5069dedea7
March 27, 2022 Office 365 E1 convert 10 10 2.90 29.00 c30e1e5c-a20f-4640-83d1-1f7a3e664b43 March 27, 2022 April 4, 2022 a11af6ef-8523-4eba-b1fa-fe5069dedea7

How do I reconcile transactions after changing billing plans?

You can change your billing plan after the first charge cycle ends. For example, you can switch from yearly to monthly payments after one year.

For example, you buy 10 licenses of a three-year "Dynamics 365 Commerce" subscription on September 20, 2021, with an annual billing plan. You can switch to monthly payments on September 19, 2022. The next month, your bill shows the monthly charge and says convert for ChargeType.

Note

Switching your billing plan only changes how much and how often you pay, not the subscription start and end dates.

Switch from annual to monthly billing plan:

Charge Type Quantity Unit Price Effective Unit Price Total Charge Start Date Charge End Date Billing Frequency
new 10 250 250 2,500 September 20, 2021 September 19, 2022 Annual
convert 10 20 20 200 September 20, 2022 October 19, 2022 Monthly

Switch from monthly to annual billing plan:

Charge Type Quantity Unit Price Effective Unit Price Total Charge Start Date Charge End Date Billing Frequency
new 10 20 20 200 September 20, 2021 October 19, 2021 Monthly
convert 10 250 229.16 2291.6 October 20, 2021 September 19, 2022 Annual

How do I validate charges in legacy and new commerce reconciliation data after migrating to new commerce?

You receive two invoices when you switch from a legacy to a new commerce subscription within a billing period.

You get a refund for what you paid in advance. Nothing changes in your service after migration.

Here's an example to illustrate the scenario:

Let's say, you bought one license of a legacy Microsoft Office 365 E3 annual subscription on July 21, 2021, with a monthly plan. On January 24, 2022, you switched to a new commerce subscription with the same term and plan.

Here's how you're billed:

  • The legacy invoice covers charges until January 23, 2022.
  • Starting January 24, 2022, you pay for your new commerce subscription on the new commerce invoice.

Consider the following details

Total licenses: One

Unit price of a license for a month: USD 16

Legacy billing anniversary date: The 21st day of each month

Legacy license-based invoice reconciliation line items of January 2022 billing period:

Subscription Name Charge Type Unit Price Subscription Start Date Subscription End Date Billing Cycle Charge Start Date Charge End Date
Microsoft Office 365 E3 Prorate fees when purchase 16 July 21, 2021 July 2, 2022 Monthly January 2, 2022 February 20, 2022

Legacy license-based invoice reconciliation line items of February 2022 billing period:

Subscription Name Charge Type Unit Price Subscription Start Date Subscription End Date Billing Cycle Charge Start Date Charge End Date
Microsoft Office 365 E3 Prorate fees when purchase 16 July 21, 2021 July 21/2022 Monthly February 21/2022 March 20, 2022
Microsoft Office 365 E3 Cancel fee -16 July 21, 2021 July 21/2022 Monthly February 21/2022 March 20, 2022
Microsoft Office 365 E3 Cancel fee -13.93 July 21, 2021 July 21/2022 Monthly January 25, 2022 February 20, 2022

New commerce invoice reconciliation line items of January 2022 billing period:

In January, the charges will be prorated after the migration.

Subscription Name Charge Type Unit Price Effective Unit Price Subscription Start Date Subscription End Date Term & Billing Cycle Billing Frequency Charge Start Date Charge End Date
Microsoft Office 365 E3 new 16 15.42 January 25, 2022 July 20, 2022 Annual Monthly January 25, 2022 February 20, 2022

Here's how your bill changes if you move to an annual billing plan:

New commerce invoice reconciliation line items of January 2022 billing period:

Subscription Name Charge Type Unit Price Effective Unit Price Subscription Start Date Subscription End Date Term & Billing Cycle Billing Frequency Charge Start Date Charge End Date
Microsoft Office 365 E3 new 192 95.21 January 25, 2022 July 20, 2022 Annual January 25, 2022 July 20, 2022

You see these line items if you switch to an annual billing plan and term:

New commerce invoice reconciliation line items of January 2022 billing period:

Subscription Name Charge Type Unit Price Effective Unit Price Subscription Start Date Subscription End Date Term & Billing Cycle Billing Frequency Charge Start Date Charge End Date
Microsoft Office 365 E3 new 192 192 January 25, 2022 January 24, 2023 Annual January 25, 2022 January 24, 2023

You see these line items for a monthly billing plan and an annual billing term:

New commerce invoice reconciliation line items of January 2022 billing period:

Subscription Name Charge Type Unit Price Effective Unit Price Subscription Start Date Subscription End Date Term & Billing Cycle Billing Frequency Charge Start Date Charge End Date
Microsoft Office 365 E3 new 16 16 January 25, 2022 January 24, 2023 Annual Monthly January 25, 2022 February 24, 2023

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