Who pays for the domain? Rebilling hosting, domains and licences
There are three ways to handle a client’s domain, hosting or licence: you pay and rebill it, you pay and absorb it, or the client pays the provider directly. Each one changes your risk and your margin. Pick one per service, write it down, and make the renewal create the invoice line.
I make Yven (Your View of Everything Necessary), which has a field for exactly this choice, so I’m not neutral. The reasoning below holds on a spreadsheet too. Nothing here is tax or legal advice. It’s a way to decide, and a list of things to settle with your client.
The three models
Every service you look after for a client falls into one of three arrangements. In Yven they’re the options on a service’s Paid by field, and the names are plain enough to use anywhere.
| Model | Who pays the provider | What the client sees | Where your margin comes from | The main risk |
|---|---|---|---|---|
| I re-bill the client | You | A line on your invoice at the price you set | The markup on top of your cost | You carry the cash until they pay, and a lapse is your lapse |
| I absorb it | You | Nothing, because it’s folded into your price | None: it’s a cost of doing the job | The cost creeps up and nobody sees it |
| Client pays directly | The client | Nothing from you; their own bill from the provider | None, though you may charge for managing it | The renewal notice goes to their inbox, not yours |
Rebilling fits the services you set up and keep running: hosting you resell, a licence you buy under your own account. You pay the provider, invoice the client, and keep the difference. It’s the one model that earns recurring income, and it’s also the one that makes you responsible when something lapses.
Absorbing works for small things inside a monthly care plan, such as a CA$12 licence you decide to cover. The price of the plan carries it. The risk is that you stop noticing what it costs, so write the cost down even when you don’t bill it.
Client pays directly is for a client who already has the account, or who wants to keep control of it. It’s the lowest risk for your cash and the highest for your calendar. You still need the renewal date, because a notice that lands in their inbox isn’t a notice you’ll see.
If you can’t decide, ask two questions of each service. Who has to act when it renews? And who loses if the date is missed? Put the service with whoever can act fastest, then price the risk of that choice. A hosting plan you can reach in a minute belongs with you. A domain the client registered years ago, on a card you’ll never see, belongs with them.
Managed by is a different question
Paying and managing aren’t the same thing, and a good record keeps them apart. You can manage a service the client pays for, or rebill one a third party manages. The client book guide covers the two fields side by side, with three cases. For this page the point is smaller: choose the model per service, not per client. One client can have rebilled hosting, a domain they pay for directly, and a licence you absorb.
Three risks to price in
A card that expires
A service on your card lapses when the card does. Nobody at the provider cares whose client it was. Put every rebilled service on one card you watch, and keep its renewal dates where you’ll see them. Yven emails one renewal digest a day, at the hour you choose, with anything overdue listed every morning until you deal with it.
A client who leaves
When a client goes, the services you pay for keep billing you until someone cancels them or takes them over. Decide in advance who does which, and do it before you archive the client. Archiving drops a client out of the Today queue and out of renewal reminders, so a service left running on an archived client is one nobody will warn you about.
A domain in your name
If the registrar account is yours, the registrar’s records name you as the owner of every domain in it. The client may think of it as theirs, and moving it later takes both of you. That’s fine when it’s agreed and written down, and a quiet problem when it isn’t. The last section of this page has my view on who should hold the account.
Setting a markup
A markup is what you charge on top of the provider’s price for the work of keeping the service current: noticing the renewal, dealing with the provider, answering the phone when it breaks. Without one, that work is unpaid. In Yven the percentage and your cost stay private to you, and the client sees only the final price.
I won’t suggest a percentage, because I have no source for what a fair one is. Try your own numbers here, or work backwards from the price you’d like to charge.
Two worked examples, with invented figures. In Canadian dollars, hosting that costs you CA$35 a month at a 20% markup is CA$42 a month, so you bill CA$504 a year, pay CA$420 and keep CA$84. In US dollars, a domain that costs US$18 a year at a 30% markup is US$23.40, which leaves US$5.40 a year. That second figure is small. You rebill a domain so nobody forgets it, not to get rich on it. The markup calculator has its own page if you want to link to it.
Tell the client what the line on their invoice covers. “Hosting, March to April” is something they’ll recognise and pay without a question. The provider’s product code isn’t. If part of the price is for managing the account, say so in a sentence once, and don’t hide it inside the number. Clients rarely mind a fee for something they can see you doing.
A care agreement: what to settle in writing
Whatever you choose, the arrangement should exist somewhere other than your memory. This is a list of questions for a conversation with your client, not legal advice, and an agreement that matters should be read by a lawyer. For each service, settle these:
- Whose name is on the account, and who holds the login.
- Who pays the provider, and at what price to the client if you rebill.
- What happens when a payment fails or a renewal is missed, and who tells whom.
- How much notice you’ll give before a price changes.
- What happens when you stop working together: who takes over each service, and how fast.
Put the answer to each in the agreement. Then record the same facts against the service itself, so the book and the agreement say the same thing.
From “Mark renewed” to an invoice line
The renewal is the moment the money moves, so it’s where the record should do the work. In Yven, marking a service renewed moves its date on by the service’s renewal period. What else happens depends on the model.
- If you rebill it, Yven records an invoiceable charge at the marked-up price. It waits for the client’s next invoice, and you can batch it with logged work into one bill.
- If you manage it, the Log work dialog opens with the client and site already filled in, so the renewal work gets recorded too.
- If the client pays directly, the date moves on and nothing is billed. The record stays accurate.
Rebilled services also feed the Money screen’s recurring renewal revenue, with the profit from your markups shown beside it. That margin is yours alone; the client never sees it. In a spreadsheet the same job takes two steps you have to remember, and “remember” is the weak point.
Check the Money screen once a month. The recurring renewal revenue figure should match what you think you’re rebilling. When it doesn’t, a service is marked the wrong way, and that’s a mistake worth finding before the client does.
Who should own the registrar account
My default is that the client owns the registrar account for their own domain and pays the registrar directly, with you holding access and the date in your book. They never lose the domain if you disappear, you carry no cash risk, and there’s nothing to untangle when you part. It’s a preference rather than a rule.
The exception is when the domain is part of a service you provide, with a monthly price that includes keeping it running. Then it can make sense for you to hold the account, as long as the agreement says so and says what happens at the end. Some registrars let an owner invite someone else to manage a domain without handing over the account, which is worth checking before you decide. For how the money should be treated when you rebill, ask your accountant; that’s their job, not a client book’s.
Where to go next
- The client book, for the fields behind each of these choices.
- The markup calculator, on its own page.
- Services in the help centre, for Paid by, Managed by and markup in Yven.
- Yven vs a spreadsheet, if you’re deciding whether the sheet is still enough.
- The Yven homepage.