# Contract terms

> For the complete machine-readable documentation index, see [llms.txt](https://apidocs.chargebee.com/llms.txt).


Subscriptions can run indefinitely or they may run for a fixed number of billing cycles. Subscription can have "contract terms", which define a lock-in period on the subscription for a certain number of billing cycles. This prevents the subscription from being canceled by the customer when it is within the contract term.

The **contract term** resource described below defines the properties of this lock-in period. This includes the [number of billing cycles](/docs/api/v2/pcv-1/contract_terms/contract_term-object#remaining_billing_cycles), the [total contract value](/docs/api/v2/pcv-1/contract_terms/contract_term-object#total_contract_value), the [action to be taken](/docs/api/v2/pcv-1/contract_terms/contract_term-object#action_at_term_end) at the end of the contract term, and so on. To allow for exceptions, you also have the option of terminating an [`active`](/docs/api/v2/pcv-1/contract_terms/contract_term-object#status) contract term and charging a [termination fee](/docs/api/v2/pcv-1/contract_terms).

A contract term starts in the `active` state and ends in the `completed` state. If the contract was canceled due to non-payment or other reasons, it can end in the `canceled` or `terminated` state. A given contract term is always associated with one, and only one subscription. A subscription, however, can be associated with only one `active` contract term. Over time, a subscription can be associated with several non-`active` contract terms. The `active` contract term for a subscription is available as an [object](/docs/api/v2/pcv-1/subscriptions/subscription-object#contract_term) within the subscription.

To enable and configure contract terms, follow these steps in the Chargebee UI:

1.  Click **Settings** on the left navigation.
2.  Click **Configure Chargebee**.
3.  Under **Billing**, click **Contract Terms**.
4.  Enable and configure the feature as needed.

Once contract terms have been configured, the following actions can be performed using the API:

-   **Define a contract term** for a subscription and **set renewal options** for the contract term. The following endpoints support this:
    
-   [Create a subscription](/docs/api/v2/pcv-1/subscriptions/create-a-subscription)
-   [Create subscription for customer](/docs/api/v2/pcv-1/subscriptions/create-subscription-for-customer)
-   [Update a subscription](/docs/api/v2/pcv-1/subscriptions/update-a-subscription)
-   [Reactivate a subscription](/docs/api/v2/pcv-1/subscriptions/reactivate-a-subscription)
-   **Retrieving** a historical record of all contract terms for a subscription can be done via the following endpoint:
    
-   [List contract terms for a subscription](/docs/api/v2/pcv-1/subscriptions/list-contract-terms-for-a-subscription)
-   **Canceling a contract term** can be done via the following endpoints:
    
-   [Update a subscription](/docs/api/v2/pcv-1/subscriptions/update-a-subscription)
-   [Cancel a subscription](/docs/api/v2/pcv-1/subscriptions/cancel-a-subscription)

#### Including a termination fee[](#including-a-termination-fee)

When a contract is canceled mid-term, you can set a termination fee to be levied. Here's how:

1.  [Create the termination fee as a `non_recurring` addon](/docs/api/v2/pcv-1/addons/create-an-addon#charge_type).
2.  [Associate this addon with a plan](/docs/api/v2/pcv-1/plans/plan-object#event_based_addons) or [include the addon to a subscription](/docs/api/v2/pcv-1/subscriptions/subscription-object#event_based_addons). In either case, set the `event_based_addons[on_event]` parameter to `contract_term_termination`.

Once the above steps are done, the termination fee will be charged automatically if you [terminate the contract in the middle of its term](/docs/api/v2/pcv-1/subscriptions/cancel-a-subscription#contract_term_cancel_option).

## Sample Contract term

```json
{
  "action_at_term_end": "renew",
  "billing_cycle": 12,
  "cancellation_cutoff_period": 0,
  "contract_end": 1548974761,
  "contract_start": 1517438761,
  "created_at": 1517438761,
  "id": "__test__3Nl7o66Rt41dR98T",
  "remaining_billing_cycles": 11,
  "status": "active",
  "total_contract_value": 10740
}
```

## Contract terms attributes

## Input Parameters

- `id` (required, string, max chars=50)
  Id that uniquely identifies the contract term in the site.

- `status` (required, enumerated string)
  Current status of contract
  Possible enum values:
    - `active`
      An actively running contract term.
    - `completed`
      The contract term has run its full duration.
    - `cancelled`
      The contract term was ended because: - a change in the subscription caused a [subscription term reset](/docs/api/v2/pcv-1/subscriptions/update-a-subscription#force_term_reset).
      
      -   the subscription was cancelled due to non-payment.
    - `terminated`
      The contract term was terminated ahead of completion.

- `contract_start` (required, timestamp(UTC) in seconds)
  The start date of the contract term

- `contract_end` (required, timestamp(UTC) in seconds)
  The end date of the contract term

- `billing_cycle` (required, integer, min=0)
  The number of billing cycles of the subscription that the contract term is for.

- `action_at_term_end` (required, enumerated string, default=renew)
  Action to be taken when the contract term completes.
  Possible enum values:
    - `renew`
      -   Contract term completes and a new contract term is started for the number of billing cycles specified in [`contract_billing_cycle_on_renewal`](/docs/api/v2/pcv-1/subscriptions/create-subscription-for-customer#contract_term_billing_cycle_on_renewal).
      -   The `action_at_term_end` for the new contract term is set to `renew`.
    - `evergreen`
      Contract term completes and the subscription renews.
    - `cancel`
      Contract term completes and subscription is canceled.
    - `renew_once`
      Used when you want to renew the contract term just once. Does the following: - Contract term completes and a new contract term is started for the number of billing cycles specified in [`contract_billing_cycle_on_renewal`](/docs/api/v2/pcv-1/subscriptions/create-subscription-for-customer#contract_term_billing_cycle_on_renewal).
      
      -   The `action_at_term_end` for the new contract term is set to `cancel`.

- `total_contract_value` (required, in cents, default=0, min=0)
  The sum of the [totals](/docs/api/invoices/invoice-object#total) of all the invoices raised as part of the contract term. For `active` contract terms, this is a predicted value. The value depends on the [type of currency](/docs/api/v2/pcv-1/contract_terms). If the subscription was [imported](/docs/api/v2/pcv-1/contract_terms) with the contract term, then this value includes the value passed for `total_amount_raised` .

- `total_contract_value_before_tax` (required, in cents, default=0, min=0)

- `cancellation_cutoff_period` (optional, integer)
  The number of days before [`contract_end`](/docs/api/contract_terms/contract_term-object#contract_end) , during which the customer is barred from canceling the contract term. The customer is allowed to cancel the contract term via the Self-Serve Portal only before this period. This allows you to have sufficient time for processing the contract term closure.

- `created_at` (required, timestamp(UTC) in seconds)
  The date when the contract term was created.

- `subscription_id` (required, string, max chars=50)
  The [Id](/docs/api/subscriptions/subscription-object#id) of the subscription that this contract term is for.

- `remaining_billing_cycles` (optional, integer, min=0)
  The number of subscription billing cycles remaining after the current one for the contract term. This attribute is only returned for `active` contract terms.