Pro Rata Refund Definition | Law Insider (2024)

FAQs

Pro Rata Refund Definition | Law Insider? ›

Pro Rata Refund means a refund of the amounts pre-paid to Supplier by Customer for the portion of a Product, or any related costs or expenses, that will not be provided or consumed by Supplier as of the date that Customer is entitled to receive any such refund, calculated.

It's a partial refund based on the proportion of the product or service used. For example, if you pay in advance for 1 year membership or subscription but decide to cancel at the end of 6 months a prorated refund is half the annual fee.

In the event this Agreement is terminated for any reason, University shall pay Pepsi a pro-rated amount of all Sponsorship Funds paid to University less commission accrued but unpaid by Pepsi and any other funds owed to the University by Pepsi.

This type of cancellation ensures any fees or refunds are calculated proportionately based on the remaining duration or value of a contract, subscription, or agreement. Pro rata cancellation promotes fairness and transparency by giving all parties confidence that their interests are being safeguarded.

If your car insurance quote was $750 for 6 months, you would expect to pay $125 per month. However, if after just over three months, you were unhappy with your provider, you could cancel, and they would refund the third month's payment on a prorated basis.

Pro Rata Refund means a refund of tuition that has been paid for a portion of the program beyond the last recorded date of attendance.

Pro rata typically means that each party or person receives their fair share in proportion to the whole. Pro rata calculations can be used in many areas including determining dividend payments. These are cash payments by corporations made to shareholders.

In order to calculate a prorated refund, you have to first figure out how many units (e.g., months) remain on the customer's subscription and what is the unit cost (e.g., monthly price). Then multiply the number of customer's remaining units by the unit cost to arrive at the pro rata refund figure.

Pro rata charges appear on your telecommunications bill for anything other than the standard recurring fees. For instance, if you sign up for a new service on the 15^th of the month, but the billing cycle resets on the 1^st of the month, you'll only be charged for the service you've received.

A term meaning proportionately allocated. For example, if two lenders each contribute 50% of a loan to a borrower, a pro rata distribution of a principal repayment made by the borrower would mean that each lender would receive 50% of the principal repayment.

Can you get a prorated refund? ›

Sometimes, you may also be eligible for a prorated refund, which is a partial refund that's based on your usage of the subscription service. For example, if you've paid for a year of services but used them for only six months, you could get a refund of half the sum.

To prorate is to divide something in a proportional way, based on time. If your new landlord prorates your first month's rent, she only charges you for the days you've actually lived in your apartment.

: divided, distributed, or assessed proportionately (as to reflect an amount of time that is less than the full amount included in an initial arrangement) The catch is that the Dolphins can get back the prorated portion of the $5 million if Madison defaults on the contract.

In order to calculate a prorated refund, you have to first figure out how many units (e.g., months) remain on the customer's subscription and what is the unit cost (e.g., monthly price). Then multiply the number of customer's remaining units by the unit cost to arrive at the pro rata refund figure.

With the pro-rata cancellation method, you compute the refund amount based on the remaining length of the policy. This means the insured only ends up paying for the number of days the insurance contract is actually in effect.

The term "pro rata" is used to describe a proportionate distribution, often involving a partial or incomplete status of payment due. For instance, pro rata can be used in bankruptcy claims, where an insolvent debtor's assets are divided proportionately among creditors based on the size of claims.

The pro-rata rule is the formula that is used to determine how much of a distribution is taxable when the account owner holds both after-tax and pre-tax dollars in their IRA(s). For the purposes of the pro-rata rule, the IRS looks at all your SEP, SIMPLE, and Traditional IRAs as if they were one.