Commitment

A commitment represents a minimum spend obligation that a customer agrees to meet over one or more time periods. Commitments can be prepaid over an installment, or post-paid with a true-up evaluation at the end of each period.

Commitment account

The commitment account is the customer account that owns the commitment and is responsible (as the invoice owner) for any true-up amounts or the prepayment.

When you create a commitment via Orders, Zuora uses the order account as the commitment account.

Applicable accounts

Applicable accounts are the accounts whose charges contribute to the commitment.

These can include the commitment account itself and, optionally, additional accounts such as child accounts in an account hierarchy or unrelated accounts selected via filters.

When you create a commitment, you can:

• Use the commitment account only, or

• Select other accounts using search and filter conditions (for example, direct child accounts, or accounts with a specific custom field value).

After you create a commitment, you can include additional eligible accounts in either of the following ways:

1. On the commitment detail page, click Reapply Applicable Items in the Current Contribution Items section. Zuora checks the accounts for eligibility and associates eligible accounts with the commitment. See View and track commitments.

2. When you create a new account through the account UI or API, enter the existing commitment number in the Associated Commitment Number field. Zuora checks the account for eligibility and associates it with the commitment if it is eligible. You can also provide the existing commitment number when you create a new account through the Create order API.

Reapplying applicable items includes newly eligible accounts. Existing charges created before the reapply process are not included. Previously associated accounts are not removed if they are no longer eligible.

Applicable charges

Applicable charges are the products and service charges whose billed amounts contribute toward the committed amount. (Also referred to as ‘contributing charges’, or ‘eligible charges’.)

You can either allow all charges on the applicable accounts to contribute, or restrict contribution to a subset of charges using search and filter conditions (for example, “specific rate plans on a specific subscription”, “recurring charges where a region custom field = US”).

The following charge types can contribute to a commitment:

• Subscription one-time charges.

• Subscription recurring charges, including Prepayment charges.

• Subscription usage charges, including Drawdown charges.

• Dynamic usage charges.

All applicable charges for a given commitment must use the same currency as the commitment. Multi-currency commitments, where the commitment currency differs from the charge currency, are not supported.

The following events can affect which charges contribute to a commitment:

• Adding products to the applicable subscription through Orders.

• Transferring the subscription owner or invoice owner of the applicable subscription.

After an owner transfer, Zuora uses the current owner relationship to determine whether future charges are eligible to contribute to the commitment. For credits or backouts, eligibility is based on whether the related billed charge was eligible for the commitment when it was billed. Historical commitment contributions are not reassigned retroactively.

After you reapply applicable items, newly created charges can become eligible to contribute to an existing commitment when they meet the commitment configuration. For example, a new charge created under an eligible account can contribute if the charge matches the applicable charge filters. Charges created before the reapply process are not included retroactively.

Commitment schedules and periods

A commitment can span multiple schedules, each of which is broken down into one or more commitment periods.

For example, a single commitment might include:

• $100 per month for 2025, and

• $500 per quarter for 2026.

Each commitment period has:

• A start date and an end date.

• A committed amount (in the commitment currency).

Each commitment must have at least one period with start date, end date, and committed amount. Commitment periods in a given commitment cannot overlap or have gaps, and each commitment must have a defined end date (evergreen commitments are not supported).

Charge contribution process

During a billing process such as a Bill Run, Zuora determines which charges contribute to a commitment and how the contribution is applied:

1. Identify whether a billed charge is associated with any commitments, based on the applicable accounts and applicable charges configuration.

2. Determine the contribution date:

   • One-time charge: charge start date

   • Recurring charge: billing period start date (billing in advance) or billing period end date (billing in arrears)

   • Usage / Dynamic usage: billing period end date (billing in arrears)

3. Apply a first-in, first-contribute order based on the contribution date (and charge number as a tie breaker).

4. Determine the target commitment period using the contribution date.

If the contribution date falls into a commitment period, the charge’s full amount for that billing period will contribute and reduce the period balance.

For dynamic usage charges billed in arrears, Zuora uses the billing period end date to determine which commitment period the charge contributes to. If you use a Single Period commitment schedule, make sure the generated commitment period includes that billed usage end date; otherwise the usage might not draw down against the commitment as expected. This is important because commitment schedules and generated commitment periods use different boundary rules: the schedule end date is exclusive, while the commitment period end date is inclusive.

The following items do not contribute and apply to a commitment:

• Legacy Commitment True-up charges used by the deprecated Minimum Commitment feature.

• Order line items (OLIs).

• Invoices and credit memos generated from Billing Schedule.

Overlapping commitments

Overlapping commitments are commitments that share applicable charges during overlapping commitment periods.

Zuora supports two overlapping-commitment models:

• Waterfall commitment: A model in which applicable charges contribute to overlapping commitments in priority order sequentially.

• Nested commitment: A parent-child structure in which child commitments are associated with a parent commitment. Applicable charges contribute to both parent and child commitments at the same time.

For information about overlapping commitments, including how to enable and configure them, see Overlapping commitment.

Discount treatment

Discounts that are applied to a contributing charge affect the contribution amount: both the service charge and applied discount charge contribute to the commitment. As a result, the net amount of the charge (after discount) is used to reduce the commitment balance.

Tax treatment

Commitments measure the value of services, not taxes. As a result:

• For tax-exclusive charges, the pre-tax amount is counted into the commitment.

• For tax-inclusive charges, the tax-inclusive amount, rather than carving out tax, is counted into the commitment.

Postpaid commitment true-up

Commitments are mainly evaluated as part of bill runs. You can also evaluate a single commitment using the UI and APIs.

A commitment period can be picked up by the billing process for evaluation when:

1. The billing target date falls on or after the commitment period end date.

2. All contributing charges have been billed through the commitment period end date.

Zuora compares the customer’s actual billed spend against the committed amount and generates a true-up invoice for any shortfall. If the customer spends more than the committed amount, the overage is billed through the service charges in the usual way.

Commitment balance

The commitment balance is the remaining committed amount in a given period that has not yet been satisfied by contributing charges. As charges are billed, their net amounts (after discounts and before tax for the tax-inclusive charges) reduce the balance for the relevant period.

You can retrieve commitment balances through:

• UI: Commitment detail page

• API: List periods for a commitment API

• Data Query and Reporting: Commitment Period object

Commitment contributions and change history

Zuora maintains commitment contribution details (also referred to as ‘commitment transactions’) that record all events affecting the balance in each period, including contributions from charges, true-ups for postpaid commitment, and balance expiration for prepaid commitment. The contribution details are available via Data Query.

Zuora also tracks a change history for each commitment, capturing creation, updates, and cancellations throughout the commitment lifecycle. The change history is available on the Commitment detail page and the Get Commitment Changes API.

Audit trail for commitments

If Audit Trail is enabled for your tenant, you can also track all changes to commitments using Zuora’s standard Audit Trail reports.

• Commitments, commitment periods, and related association objects (such as associated accounts and associated items) can be configured as auditable business objects.

• You can query audit events for these objects alongside other auditobjectchangeevent records, using filters such as date range, user, account, or object type.

• Each audit event captures who made the change, when it occurred, and the before-and-after values of key commitment fields.

Reporting, export, and integration support

Commitment data is available in the following Zuora data and analytics tools:

• Data Source Export and Exports: commitments and commitment periods can be included in exports for downstream analysis.

• Data Query and Object Query: you can query commitments, commitment periods, and contribution events using SQL-style queries.

• Reporting: commitment fields can be added to standard or custom reports.

• Notifications: you can configure notifications that are triggered by commitment balance thresholds or upcoming period end dates.

• Multi-Org and Multi-Entity: a commitment carries over the org label from the commitment account. It participates in the same multi-org and multi-entity data model as other Zuora Billing objects.