Skip to content

Installments

Billing Automation

Installments represent staged payment plans in sale models where the money due is payable in a series of individual payments.

JustOn implements installment support using either the custom setting Installment or, for greater variability, a custom JSON configuration.

Enabling Installments
Using Installments

Understanding Payment Plans and Installments

Sellers may want to support sale models where buyers commit to multiple split payments over a period of time instead of one single payment. These models are known as installment sale or hire purchase. Seller and buyer agree on a staged payment plan that defines the number of individual installment payments, the intervals between them, and the individual payment amounts.

Installment sales can allow businesses to defer the recognition of revenue for tax purposes.

Installments Support in JustOn

To support staged payment plans for invoices, JustOn allows for setting up installments, which represent models for intended payment plans.

JustOn enables installments using either the custom setting Installment or, for greater variability, a custom JSON configuration (see Installments Usage). Either way, you basically configure the number of installments as well as their interval, and optionally specific amounts or rates (see Installment Information).

Installments Concepts

Installments split an open invoice amount into smaller parts and spread the payments due over a larger period.

installments
Applying staged payment plan with installments

Once applied, installments impact the creation of dunning reminders and SEPA Direct Debit orders. In both cases, JustOn takes the relevant amount due only:

  • If, for example, at the time of a dunning run only the first installment of a payment plan is overdue, only this part will be subject to the produced reminder.
  • If at the time of exporting SEPA Direct Debit orders only one installment of a payment plan is due, only this part will be subject to a corresponding bank transfer order.

Installments Usage

JustOn supports several use cases that rely on installments:

  • Fixed payment plans

    You can calculate the payment plan based on a configurable number of installment payments and a configurable interval. Optionally, you can set fixed amounts or rates, otherwise JustOn distributes the amount equally to the installments. Once defined and set, this invariable model is applied to all accordingly produced invoices.

  • Service period-based payment plans

    You may need to create installments that correspond to the service periods of invoice line items. So instead of configuring a model to be applied, you directly relate the payment plan to the service period months (or quarters). The resulting installment amounts for each invoice line item are evenly distributed across their respective service period fractions spanned by its total service period (as defined by the Invoice Line Item fields Service Period Start and Service Period End).

    This provides for easily modeling recurring billing with "permanent" invoices.

    For both fixed and service period-based payment plans, you can use the custom setting Installment.

  • Variable payment plans

    You may have to cover individually negotiated conditions, like, for example, account-specific initial amounts. In this case, you also define a calculation model to be applied but allow for variable data (as individually retrieved from specific fields) as the input.

    To support such scenarios, you apply custom installments using a JSON configuration.

Info

The support for variable installment configurations is available as of JustOn 2.68.1.

The support for service period-based installments is available as of JustOn 2.70.

If this feature is enabled, you can configure an installment for a subscription. When executing an invoice run, JustOn consequently produces an invoice with the payment plan (installments) set up.

Depending on your business requirements, you can also make the installment settings available for use with accounts or objects based on which you create invoices using the generic invoice run. When defining an installment on the account or the accordingly configured source object, JustOn copies it to the invoice when creating an invoice for this account or from this object.

In addition, you can apply installments manually to draft or open invoices. This allows, for example, to help customers who have failed to pay an invoice: You retroactively provide a payment plan for an invoice that has already produced a dunning reminder.

Info

Staged payment plans (installments) do not imply revenue deferral by default. If not specifically set otherwise, JustOn consequently applies the Default revenue recognition rule when generating bookkeeping data for invoices with installments.

You can, however, combine the Booking Month or Service Month revenue recognition rules and the Sync With Revenue tax recognition rule with installments.

Installment Dates

Installments use the Payment Due Date of the invoice as the base for the payment plan. If not configured otherwise (using Date Reference, see Installment Information), the Payment Due Date of the invoice will be the date of the first installment payment. With each subsequent installment payment, JustOn adjusts the Next Payment Due Date of the invoice.

When exporting SEPA-compliant bank transfer orders, the Next Payment Due Date of the invoice is relevant: It must be in the past or within the next 14 days from today. For invoices whose Next Payment Due Date is in the past, JustOn corrects the SEPA order payment date to TODAY + 2.

Installments and Received Payments

Installments keep track of received payments. The amount is determined from all balances that affect the open payment amount, as produced in the course of payment registrations, settlements, partial credits, write-offs, etc. – like, for example, Payment, Clearing, Write-Off, Refund or Chargeback.

Balances of the types Chargeback Fee, Dunning Fee and Dunning Income are ignored.

When assigning a relevant payment balance to an invoice, JustOn saves the resulting amount to the Received Payment Amount field. Be aware of the following behavior:

  • If the value of Received Payment Amount is equal to the installment's Amount, then JustOn sets the Payment Status field to Paid.
  • If Received Payment Amount is larger than the installment amount, JustOn distributes the amount over the subsequent installments, sorted by date.
  • If Received Payment Amount is smaller than the installment amount, the Open Payment Amount field will show the remaining amount to be paid. The Payment Status field is set Open in this case.

Generally, installments ignore overpayments and do not track the overpaid amount.