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# Understanding Plan Proration: Credits & Charges When Upgrading or Downgrading

# What is Proration?

Proration is a billing adjustment that ensures you pay fairly when you change your subscription plan during a billing cycle. When you upgrade or downgrade, we calculate charges based on the time remaining in your current billing period.

## Key Points:

* Prorations happen when you upgrade, downgrade your plan, or change the number of seats
* You pay for what you use and receive credit for unused time
* Prorations are calculated automatically by Stripe and our system

|| **Note**: Cancellations happen at the end of the billing cycle, so no proration is needed

## How It Works

When you change your subscription, two separate calculations happen:

### 1. Financial Proration (Stripe)
Adjustments to your subscription charges on invoices. This determines what you pay or receive as a credit.

### 2. Credit Proration (On Caimera)
Adjustments to available credits in your account balance. This determines how many credits are added or removed.

**Both happen at the same time but serve different purposes.**

## Scenarios

### Upgrading Your Plan
If you upgrade on day 10 of a 30-day cycle:
* You'll be credited for the remaining 20 days at your old plan rate
* You'll be charged for the remaining 20 days at your new plan rate
* The difference is added to your next invoice or deducted if you're due a refund

### Downgrading Your Plan
If you downgrade on day 15 of a 30-day cycle:
* You'll be credited for the remaining 15 days at your old plan rate
* You'll be charged for the remaining 15 days at your new plan rate
* If the downgrade results in a lower charge, the difference may appear as a credit
* **Note**: Credit balances can go negative during downgrades, which is normal


|| Credit adjustments happen immediately when your subscription changes. You'll see the updated balance in your account right away. Prorations ensure you only pay for what you actually use!

### Scenario 1: Upgrade Plan
You upgrade from MINI ($15/month) to STARTER ($45/month) on day 10 of a 30-day cycle.

Calculation: ($5 old) + ($30 new) - $15 = $20 additional charge
You're charged an additional $20 immediately.

### Scenario 2: Add Seats
You add 1 seat to STARTER plan ($45/month/seat) on day 15.

Prorated charge for extra seat: 15/30 × $45 = $22.50

You're charged $22.50 for the additional seat.

### Scenario 3: Change Seats and Upgrade Plan
You change from STARTER ($45/month) with 2 seats to PRO ($117/month) with 3 seats on day 15.

Calculation: ($45 old) + ($175.50 new) - $45 = $130.50 additional charge

You're charged $130.50 immediately. All 3 seats get PRO access.


For any questions about upgrading, downgrading your plan and proration, reach out to us on contact@caimera.ai