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# Subscription Recurring Billing Considerations

A subscription is a recurring sale of your offering (products or services) and the entitlement to access them. It is billed according to a billing schedule (called a billing plan), which indicates the frequency of billing, and is purchased by a customer (the customer account stores the customer details along with the customer's payment method).

Subscriptions are the most common elements used by Resellers (Service Providers). Commerce Engine supports flexible billing plans that define the frequency of billing and allow you to develop new business models accordingly. The subscription element in the system (per customer account) generates a transaction every time a billing action is required.

The majority of subscriptions are billed on their **Anniversary date**, the day they were created defined by their billing frequency as part of a billing cycle (every day, week, month, or year).

The subscription service period **Start** and service period **End dates** reflect the current billing cycle duration. For each successful billing, the dates are renewed accordingly.

Commerce Engine updates the subscription status based on the system's ability to collect payment and the input from the customer. The status changes based on retry logic rules, the defined grace period, or when the subscription expires. A subscription will be canceled if its payment cannot be collected.

A subscription entitlement determines whether a customer has access to your offerings by providing access codes that are recognized by your system. Entitlements are defined in the product and/or billing plan and granted by the subscription that includes these items. Entitlements are active as long as the subscription is in a good standing.

## Offset Billing

Commerce Engine provides the ability to separate the subscription billing date from the service start/end date. This is especially useful for payments methods that are external to Commerce Engine.

For example, we want the subscription to start on June 1st, but the bill needs to be sent 5 days prior, to provide time for payment receipt. In this case, the system will issue a charge file for May 25 to bring the system up to date and the next billing will happen on June 25. The service period will be from the first until the end of the month. The offset billing in Commerce Engine is controlled by the billing plan. If a billing plan is modified on a subscription, the billing offset is canceled.

**Parent topic:**[Charging and Billing](chargingBilling)


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