improvement(billing): immediately charge for plan upgrades

[icecrasher321]

Summary

Right now we create a proration and charge at next invoice. We should just charge immediately.

Type of Change

• Other: UX Improvement

Testing

Tested manually

Checklist

• Code follows project style guidelines
• Self-reviewed my changes
• Tests added/updated and passing
• No new warnings introduced
• I confirm that I have read and agree to the terms outlined in the Contributor License Agreement (CLA)

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1 Skipped Deployment

Project	Deployment	Actions	Updated (UTC)
docs	Skipped		Mar 19, 2026 4:01am

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PR Summary

Medium Risk
Changes Stripe proration behavior to immediately invoice on subscription updates and adjusts webhook side effects (unblocking/resetting usage) based on proration invoices, which could affect customer access and billing state if misclassified.

Overview
Switches plan and seat-change subscription updates to use Stripe proration_behavior: 'always_invoice' so upgrades/seat changes are charged immediately instead of waiting for the next renewal.

Updates the invoice payment-succeeded webhook to treat subscription_update (proration) invoices specially: it only unblocks users when a non-zero amount was actually paid, and it avoids resetting usage on proration invoices to prevent mid-cycle usage resets.

^{Written by Cursor Bugbot for commit b4371a7. Configure here.}

[greptile-apps]

Greptile Summary

This PR changes the Stripe proration_behavior from create_prorations to always_invoice across the switch-plan and seat-update APIs, so mid-cycle upgrades and seat additions are charged immediately rather than deferred to the next billing cycle. A corresponding guard was added to handleInvoicePaymentSucceeded to prevent zero-amount proration credit invoices (e.g. downgrades) from unblocking users and wiping mid-cycle usage.

Key changes and findings:

• switch-plan/route.ts: Single-line change to always_invoice — clean and correct for the immediate-charge goal.
• organizations/[id]/seats/route.ts: Same change; also removes a previously incorrect inline comment claiming create_prorations charged immediately. The success message for seat reductions ("You'll receive a prorated credit") may mislead users into expecting a card refund rather than a Stripe account-balance credit.
• invoices.ts — unblock logic: The new shouldUnblock guard correctly prevents $0 credit invoices from triggering an unblock. However, the amount_paid > 0 branch allows a successful upgrade proration payment to unblock a user who may still have an unresolved prior subscription invoice failure. Only subscription_cycle invoices represent settlement of the period's subscription debt and should trigger an unblock.
• invoices.ts — logger refactor: The logger.error call in handleInvoicePaymentFailed was correctly moved inside the records.length > 0 guard, avoiding a misleading log entry when no subscription record is found.

Confidence Score: 2/5

• The API changes are correct, but the webhook unblock logic introduces a new edge case where a successful upgrade payment can lift a billing block that was placed for a different, still-unpaid invoice.
• The proration_behavior change itself is straightforward and correct. The webhook guard for zero-amount invoices is a good addition. However, the shouldUnblock = !isProrationInvoice || (amount_paid > 0) condition allows a paid upgrade invoice to clear a block that was set because of an entirely separate failed subscription payment — the two invoices are independent debts. A blocked user could upgrade, pay the proration, and regain access while their original subscription invoice is still outstanding. This is a meaningful billing integrity issue in a payment-critical path.
• apps/sim/lib/billing/webhooks/invoices.ts — specifically the shouldUnblock condition at lines 509–510

Important Files Changed

Filename	Overview
apps/sim/app/api/billing/switch-plan/route.ts	Single-line change from create_prorations to always_invoice so plan switches immediately charge rather than wait for the next billing cycle. Logic is straightforward; the main risk lives in the webhook handler rather than here.
apps/sim/app/api/organizations/[id]/seats/route.ts	Changes proration_behavior to always_invoice for seat count changes. Also removes an incorrect inline comment that claimed create_prorations charges immediately (it doesn't). The response message for seat reductions may mislead users into expecting a card refund rather than a Stripe account credit.
apps/sim/lib/billing/webhooks/invoices.ts	Adds guards to handleInvoicePaymentSucceeded to skip unblocking and usage resets for zero-amount proration invoices. The zero-amount guard is correct for downgrade credits, but the positive-amount case (amount_paid > 0) allows a successful upgrade payment to unblock a user who may still have a prior unresolved failed subscription invoice.

Sequence Diagram

sequenceDiagram
participant User
participant API as Switch-Plan / Seats API
participant Stripe
participant DB as Database
participant Webhook as Invoice Webhook
User->>API: POST /api/billing/switch-plan (or PUT seats)
API->>Stripe: subscriptions.update(proration_behavior: always_invoice)
Note over Stripe: Previously: proration added to next invoice<br/>Now: immediate invoice created & charged
Stripe-->>API: Updated subscription
API->>DB: Update plan / seat count
API-->>User: 200 OK
Stripe->>Webhook: invoice.payment_succeeded (billing_reason=subscription_update)
alt amount_paid > 0 (upgrade)
Webhook->>DB: Unblock user (shouldUnblock=true)
Note over Webhook: ⚠️ May unblock user with a prior failed subscription invoice
else amount_paid == 0 (downgrade credit)
Webhook->>Webhook: Skip unblock (log info)
end
Note over Webhook: Usage reset always skipped for proration invoices
Stripe->>Webhook: invoice.payment_failed (billing_reason=subscription_update)
Note over Webhook: ⚠️ Failures still block users (no guard on failure path)<br/>But prior thread: upgrade failures may leave plan upgraded in DB

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Comments Outside Diff (2)

1. apps/sim/lib/billing/webhooks/invoices.ts, line 509-510 (link)

   Upgrade proration success can unblock users with prior failed payments

   With always_invoice, when a user upgrades their plan mid-cycle, Stripe immediately charges for the proration. If that charge succeeds, isProrationInvoice = true and amount_paid > 0, so shouldUnblock = true. This can unblock a user who was previously blocked for a different failed invoice (e.g., their regular subscription renewal).

   The scenario:

   1. User's monthly subscription charge fails → user is blocked (billingBlockedReason = 'payment_failed')
   2. Stripe keeps the subscription active during the retry window
   3. User calls /api/billing/switch-plan (no blocked-user guard in that route)
   4. Upgrade proration invoice is generated and paid → invoice.payment_succeeded fires
   5. amount_paid > 0 → shouldUnblock = true → user is unblocked
   6. The original subscription invoice is still unpaid

   Unblocking should only be done in response to a subscription_cycle invoice, which represents the actual period payment. Proration invoices reflect mid-cycle pricing adjustments, not settlement of a previously failed debt:

2. apps/sim/app/api/organizations/[id]/seats/route.ts, line 222-225 (link)

   Misleading success message for seat reductions

   With always_invoice, Stripe generates a negative-amount proration invoice and applies it as a credit to the customer's Stripe account balance — not as a refund to the original payment method. The current message "You'll receive a prorated credit" may lead users to expect money back on their card, which typically won't happen unless the balance is later applied to a future invoice.

   Consider clarifying the credit mechanism:

_{Last reviewed commit: "address bugbot comme..."}

[icecrasher321]

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[icecrasher321]

@greptile

[icecrasher321]

bugbot run

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[icecrasher321]

@greptile