> ## Documentation Index
> Fetch the complete documentation index at: https://lago-ftr-wallet-improvements.mintlify.site/llms.txt
> Use this file to discover all available pages before exploring further.

# Plan model

> The plan model defines when and how much a customer is charged.

## Plan interval[](#plan-interval "Direct link to heading")

The plan interval corresponds to the billing period and defines when invoices
are generated. In most cases, the [charges](/guide/plans/charges) are also calculated
according to the plan interval.

There are several plan intervals:

1. **Weekly**: subscription fees and charges are billed on a weekly basis
   (Monday to Sunday);
2. **Monthly**: subscription fees and charges are billed on a monthly basis;
3. **Quarterly**: subscription fees and charges are billed on a quarterly basis (every 3 months); and
4. **Yearly**: subscription fees are billed on a yearly basis and charges can be
   billed monthly or annually.

## The base charge amount and its currency[](#the-base-charge-amount-and-its-currency "Direct link to heading")

You need to define a **base amount** for each plan (i.e. the subscription fee).
This amount is what the customer will pay by subscribing to the plan regardless
of their consumption.

This base charge `amount` is recurring, and billed at the end of each billing
interval.

## Pay in advance or in arrears[](#pay-in-advance-or-in-arrears "Direct link to heading")

With Lago, you can define if the base charge of the Plan is paid **in advance**
or **in arrears**.

* If the toggle is `off` (boolean set to FALSE), the Plan is paid for the past
  period (in arrears).
* If the toggle is `on` (boolean set to TRUE), the Plan is paid upfront (in
  advance) for the period.

<Note>
  Note that this toggle only affects the base amount of the Plan. Additional
  charges for per-usage Billable metrics **are always paid in arrears because
  they are linked to a past consumption of your customers.**
</Note>

## The trial period (optional)[](#the-trial-period-optional "Direct link to heading")

You can decide to apply a `Trial period` for a Plan. This means your customers
can test the Plan without being charged for a certain number of days. This is
optional and if the value is null, the Plan holds 0 day of trial.

Note that the trial period **can only be specified in days**. A pro-rata is
applied to the Plan regarding the number of days offered.

<Warning>
  A trial period can only be applied to the first subscribed Plan. In case of an
  upgrade or downgrade, the trial period of the new Plan **is not applied**.
</Warning>

## Taxes applied on plans or charges

You have the option to store taxes either at a Plan level or for specific charges.
This choice entails that whenever you apply this plan to a customer without taxes,
invoice fees will inherit the taxes defined in the corresponding plan.

<Info>
  It's important to acknowledge that taxes applied to a plan will influence the charges,
  unless the taxes are explicitly defined for the individual charge.
</Info>

## Pro-ratas based on subscription date[](#pro-ratas-based-on-subscription-date "Direct link to heading")

Obviously, we know that your customers don't necessarily sign up for a Plan at
the very begining of each month (or each year). This is why Lago automatically
applies a pro-rata for the first and the last subscription period of a Plan.

Here is an example: A `Customer X` signs up for the Plan `Start` (base amount of
10€, with no trial period) on April 15, 2022.

* If the Plan is defined to be `paid in arrears`, this Customer will be charged
  5€ for the first month at the end of the period (May 1, 2022).
* If the Plan is defined to be `paid in advance`, this Customer is charged 5€
  straight away for the first month (April 15, 2022).

<Note>
  Note that pro-ratas can also be applied in case of **upgrades or downgrades**.
</Note>