This page describes a feature that is part of Relationship Invoicing, which is a new method of bill presentment for you and your subscribers. The information on this page is only applicable to newly created sites that opt-in as described in Opting In.
You can read more about the beta status and future plans, including how to be notified when these features are availble for existing sites.
Invoices are financial documents that represent a sale by a seller (merchant) to a buyer (customer). In Chargify, invoices are issued for all billing events: subscription signup, subscription renewal, prorated changes, and one-time charges. Our invoices contain the following:
- Details about the merchant (contact and business information)
- Details about the customer (name, contact information and addresses)
- Line items detailing each item being sold (quantity and price)
- Discounts applied to each line item and the invoice as a whole
- Taxes applicable to each line item and the total tax being collected
- Totals and summaries for the entire sale
- An invoice status, including amount due or paid
- Payment history
The most important pieces of information on our invoices are the status, line items, discounts, taxes, and payment details.
Invoices seen by the customer are usually either Open (unpaid) or Paid. The status area provides the current invoice status at-a-glance. See “Invoice Statuses”, below.
Invoices are primarily composed of line items. Each line item contains a name, description, quantity, unit price, and subtotal.
You’ll see one line item on an invoice for each product and component on a subscription.
Discounts on a line item derive from your coupons. The total discount for the whole invoice appears at the bottom of the invoice.
Since your coupons do not necessarily apply to every line items (application is controlled by Coupon Restrictions), there is a “Discounts” box that enumerates the coupons applied. Each coupon is numbered, and each line item is denoted with a matching superscript number where the coupon applies.
Taxes levied on the subscription via either Avalara taxes or Custom taxes appear at the bottom of the invoice as well.
Some actions generate a credit on a subscriber account. A common example is a prorated downgrade.
Credits are captured in “credit notes” (also sometimes known as “credit memos” or “credit invoices”). A credit note is like a “reverse invoice” - it contains line items representing the amount credited to specific items (products and components) and sometimes must also “return” amounts already discounted or taxes already paid.
When a subscriber has a credit balance, the available balance is applied to an invoice when it is issued, like a payment. Credits reduce the invoice due amount, like a payment.
See Credit Notes for more information.
The payments applied to an invoice (including any Credits or Prepayments) are shown in the Payment History section.
- Draft: A Draft invoice is a temporary status of an invoice in the middle of being composed. Draft status is usually seen on manually generated invoices, before they are issued.
- Pending: A Pending invoice is one generated automatically that is still collecting charges before it is issued at the next normal renewal. An example is an invoice that represents mid-period prorations that are being accrued until the next billing.
- Open: An Open invoice has been issued and is ready for payment, but has not yet been fully paid.
- Paid: A Paid invoice has been paid in full.
- Voided: A merchant may manually void an invoice, which marks it with the Voided status. A voided invoice does not expect payment and does not affect revenue.
- Canceled: A Canceled invoice is one that was open when the Subscription was canceled (whether through dunning or intentional cancellation). Canceled invoices are different from voided invoices in that they represent “uncollected amounts” for revenue purposes. Canceled invoices may be re-opened in the case of a reactivation.
There are two methods for invoice collection: automatic and remittance.
- Automatic Collection: Chargify attempts to collect payment automatically from a payment method on file (credit card or ACH) when the invoice is issued.
- Remittance Collection: Chargify does not attempt to automatically collect payment. Instead, your customer remits payment on the invoice, often in the form of check or bank draft, in response to receiving the invoice.
The default collection method is controlled in your site’s invoice settings. The collection method may also be set on a per-subscription basis from the subscription summary page.
To change an individual subscriptions payment method after signup, please follow the steps below:
- In the subscription summary page, on the line item Payment Method select “Change”
While viewing Edit Payment Method, you will be prompted to toggle between Automatic and Manual.
- For invoices that are in the
Canceledstatus, you may shift the payment method from automatic to remittance.
- When viewing an invoice that falls into one of these categories, select
More Options -> Change Collection Method.
- This workflow is not available for invoices that are
Invoices are generated for all billing events in Chargify. There are two classes of generation: automatic and manual.
Chargify generates invoices for the following billing events:
- Signup: When a new subscription starts.
- Renewal: When an existing subscription periodically renews.
- Prorated upgrades for immediate capture: When a prorated upgrade is made and immediate capture of the due amount is desired, an invoice is generated and issued for the upgrade.
- Prorated upgrades for delayed capture: When a prorated upgrade is made and capture of the due amount is delayed, the upgrade charges added to a pending invoice (either an existing one or a new one as necessary). The pending invoice is issued when normal renewal occurs.
Note that prorated downgrades generate a Credit Note (like a “reverse invoice”) that is applied against subsequent invoices.
Invoices advertise two main dates: the issue date and the due date.
- Issue Date: the date the invoice is made available for payment. This happens after all line items have been added and the invoice is not expected to change after this date.
- Due Date: the date the invoice payment is due.
Currently, these dates will always match, since Chargify only supports the concept of “immediately due” invoices. In the future, we will have features that allow for invoice due dates to be pushed out from the Issue Date.
Normal Chargify dunning still applies, even for the new invoices.
The important thing to remember is that dunning operates on a per-subscription basis based on the status of the subscription, not necessarily the status of the invoice(s). When the subscription is past due, it implies that there are one or more invoices in an Open status past their due date. When Chargify attempts to collect payment for a past due subscription, it attempts to collect the entire amount due on all open invoices.
Relationship Invoicing is an opt-in feature for new sites. Please email email@example.com to get started using Relationship Invoicing when creating a new site.
Note: The ability to enable Relationship Invoicing on existing sites will come later. See Future Plans.
Your first task in Relationship Invoicing is to review the settings (via
Settings -> Invoices) to configure how you want your invoices to look and act.
We recommend the following first steps:
- Upload a logo to display on your invoices
- Pick your default collection method, automatic or remittance. (Automatic collection attempts to collect automatically from the card on file, whereas remittance collection prompts the customer for payment, which get recorded against the invoice by a human)
- Turn on invoice emails for both automatic and remittance collection
- Customize your email templates for emails that are sent when invoices are issued
Create a product or two and, optionally, some components. Then, create some subscriptions using your own email address and watch the invoice emails roll in!
- View the invoices online and see how they will be presented to your customers.
- Tweak your invoice settings to refine the experience for your customers
- Add some coupons and see how discounts are presented