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Plan Changes Must Apply Proration Rules Transparently

8 min read

Upgrades, downgrades, and plan changes mid-cycle require proration logic that is predictable, displayed to the user before confirmation, and consistent with the billing period.

Rule

Plan changes must compute and display the prorated amount before charging.

Why

Silent charges after plan upgrades are a leading cause of subscription cancellation.

Must

  • Calculate and display the immediate charge (or credit) before the user confirms.
  • Apply immediate proration for upgrades and deferred proration for downgrades.
  • Use the provider proration calculation rather than computing it independently.
  • Record the proration event in the subscription audit log.

Should

  • Show both the one-time adjustment and the new recurring amount on the confirmation screen.
  • Allow the user to choose: prorate now or change at period end.

Anti-patterns

  • Charging proration without a preview step.
  • Inconsistent proration between provider and app calculations.

Test Cases

  • Upgrade mid-cycle shows correct prorated charge preview.
  • Downgrade at period end does not charge immediately.

Telemetry

  • plan_change_previewed
  • plan_change_confirmed
  • plan_change_cancelled_at_preview