There are four different types of app-related charges and credits that you can receive:
- Subscription charges - These charges are for recurring use of an app, such as a monthly subscription. They appear on your regular Shopify subscription bill.
- App usage charges - These charges are variable based on how much you're using the app or the service that it integrates with (such as the number of interactions provided by a customer service app). They appear on your regular Shopify subscription bill.
- One-time app purchases - These charges are for specific services provided by an app (such as a single migration of your data from one platform to another). They appear on separate bills.
- Application credits - You are entitled to application credits under certain circumstances, such as when you downgrade a paid app subscription partway through its billing cycle. These credits appear on your Shopify subscription bill, and can be used towards future application charges on Shopify.
You are billed for your app subscriptions and app usage as part of Shopify's 30-day subscription billing period. However, your app has a separate 30-day billing cycle, which impacts the charges you'll see on your Shopify bill.
Shopify billing cycle
You are invoiced every 30 days for your Shopify subscription, and you pay in advance for the following 30 days. For example, suppose you receive your Shopify invoice April 5. Since April has 30 days, the cycle will terminate at the end of May 4th. On May 5, you are billed for the second month of your subscription. The third month payment is billed on June 4 since may has 31 days.
App billing cycles
Apps that charge merchants using subscriptions are billed on an independent, 30-day billing cycle. This billing cycle is charged for at the same time as the Shopify subscription. There are two types of subscriptions:
- Recurring pricing plans
- Usage pricing plans
Recurring pricing plans
Recurring app charges are billed with the next Shopify 30-day invoice. In the example below, the bill on May 5 includes the app subscription that overlaps from April 20-May 20. The bill on June 4th similarly includes the app subscription from May 20-June 19 (since May has 31 days).
If you stop paying your bills, or close your store, then Shopify freezes your account and your recurring app charges. If you start your payments again, or re-open your store within 30 days, Shopify unfreezes your account and your recurring app charges resume.
If you pause your store using the Pause plan, you don't need to uninstall your apps. Your recurring app charges are frozen while your store is on the Pause plan, but the charges resume automatically when you reopen your store, or if your store is upgraded to the Pause and Build plan.
Usage pricing plans
If you use apps that bill for usage, then you will always be billed for these usage events on the next bill. For example, in the diagram below the usage record created on April 26 will appear on the May 5 bill. The usage record from May 15 appears on the June 3 invoice. Although these two usage records are tied to the same app subscription, they appear on two separate invoices.
It's important to keep these different billing cycles in mind when considering app bills, uninstalling apps, and app usage charges.
Although you'll see recurring app charges on your account as soon as you approve an app charge, the charges aren't due immediately. Recurring app charges are applied to your account either when you receive your 30-day Shopify subscription bill, or if you exceed your billing threshold (whichever comes first).
Uninstalling apps with recurring charges
Make sure that you consider app billing cycles when you plan to uninstall an app. Recurring app charges are generated the first time an app charge is approved, and then on the first day of an app's billing cycle. Because of this, a charge will appear on your bill even if you uninstall an app only a day or two after you install it.
App usage charges
App usage charges are associated with an app's 30-day billing cycle and represent charges for app usage events. Because an app's billing cycle will not necessarily be the same as Shopify's 30-day billing cycle, it's possible to see usage charges for a single app billing cycle spread over two Shopify subscription bills. You should keep the different billing cycles in mind when considering usage charges on your bills.
Apps that issue usage charges include a capped amount that prevents billing from exceeding a maximum threshold over the duration of the billing period. To continue using an app after exceeding a capped amount, you need to agree to a new usage charge. This prevents you from being charged for any usage over and above the capped amount.
One-time app charges
One-time app charges are for apps that aren't billed on a recurring basis. You'll see separate bills for any one-time app charges, and they won't appear on your regular Shopify subscription bill.
App prorating, upgrades, and downgrades
If you upgrade or downgrade your subscription with an app, then the app will prompt you to agree to a new recurring app charge. This is because Shopify allows each app only one recurring app charge to be enabled at a time. The existing recurring application charge will be canceled and replaced by the new charge.
When you upgrade your plan by moving from a less expensive charge to a more expensive charge, the charge is prorated based on the difference in price and the number of days remaining in the billing cycle. For example, if you begin a 30-day billing cycle on a $5.00 plan, and then upgrade to a $15.00 plan on day 15 of the billing cycle, you'd be charged $5.00 + ($15.00 - $5.00) * (15/30) = $10.00 USD.
If you downgrade your plan by moving from a more expensive charge to a less expensive charge, then you're automatically offered an application credit based on the difference in price and the number of days remaining in the billing cycle. This application credit can be used towards any future application purchase on Shopify.
App billing FAQ
Why does it look like I'm being charged in arrears?
You'll see app charges on your account as soon as you install an app, but fees won't be due until you receive your 30-day bill.
Why am I being billed two times for the same 30 day billing cycle?
If you incur app usage charges after the Shopify cycle has ended but before the apps billing cycle resets, then those usage charges will appear on the next Shopify subscription bill.
Why are taxes applied to my app charges?
If you live in a region where Shopify is required to charge taxes on any of your account charges, these charges appear in your Shopify invoice. This might include your app charges.