Vendor sends a 'true-up' invoice after year-end
On annual contracts with growth flexibility, you get a year-end settlement for extra users added during the year. Plan for it.
Try this first
- 1Read your contract's 'true-up' or 'overage' clause; it specifies how extra use is billed.
- 2Track active user counts monthly yourself; year-end then never surprises you.
- 3On strong growth: consider negotiating a new baseline with the vendor before year-end rather than after.
- 4Accounting: reserve monthly for estimated true-up so the settlement is not a cash-flow event.
- 5For next renewal: negotiate a higher baseline or different structure if true-ups consistently exceed expectations.
When to bring us in
When true-ups exceed 20% of the base contract: ask for advice, you likely overpay for the structure you picked.
See also
- New hire has an account but cannot reach Outlook or TeamsAn M365 account without a license is an empty shell. Assigning takes a few clicks, but picking the right plan pays off long-term.
- Employee left, but their email must be retainedPulling the license straight away starts a 30-day timer on the mailbox. The right route keeps access to the mail without paying for the license.
- We pay for licenses nobody usesBetween leavers, duplicate plans, and test accounts there is often 10-20% wasted license spend. A usage report exposes it fast.
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