How Does Shopify Billing API Handle Plan Changes? (Yearly to Monthly)

[its__masoodmohd]

Hi Shopify Community,

I'm developing a Shopify app and planning to implement subscription-based plans using the Billing API. I have a question about how the Billing API handles scenarios where a user changes their subscription plan. For example, if a user purchases a yearly plan subscription and immediately switches to a monthly subscription before the yearly plan ends:

Is the remaining amount from the yearly plan automatically refunded by Shopify? If not, how should I manage such scenarios in my app? Should I calculate the remaining balance and issue a manual refund or credit? I would appreciate any insights or best practices on managing subscription changes within the Shopify Billing API.

According to the document, In replacementBehavior as standard(default), 

Cancels the merchant's current app subscription immediately and replaces it with the newly created app subscription, with the exception of the following scenarios where replacing the current app subscription will be deferred until the start of the next billing cycle.

• The current app subscription is annual and the newly created app subscription is annual, using the same currency, but is of a lesser value.
• The current app subscription is annual and the newly created app subscription is monthly and using the same currency.
• The current app subscription and the newly created app subscription are identical except for the discount value.
  
  

But in the App development test payment, it applies immediately, in any of the cases.

Thank you!