Auto-renewal and cancellation terms for a subscription product

Automatic renewal is where subscription businesses make their money and lose their customers' trust, and the law has moved to police it: consumer renewals are tested for fairness and are coming under specific rules on information, reminders and cancellation, while business renewals are governed by what the contract says and whether it is reasonable. The terms have to do both jobs in one document without applying the wrong rule to the wrong customer. I draft renewal and cancellation terms, as part of a set of subscription terms or as a replacement for the clauses in yours, for a fixed fee of £995, delivered in five working days.

Who this is for

Software, content and subscription businesses in England and Wales whose customers pay on a recurring basis, and who need renewal and cancellation terms that consumer law will enforce and business customers will sign.

What matters in renewal and cancellation terms

The subscription contract rules for consumers

Part 4 of the Digital Markets, Competition and Consumers Act 2024 is introducing rules for consumer subscription contracts: specified information before the contract, reminder notices before a renewal payment and before a free or discounted period ends, a cancellation process that is not more difficult than signing up, and cooling-off periods at the start and on renewal. The terms should be drafted to those rules now, with the renewal date, the price and the cancellation route stated in the terms and repeated in the reminders.

Renewal terms the unfair terms rules strike out

Schedule 2 to the Consumer Rights Act 2015 lists as potentially unfair a term that automatically extends a fixed-term contract where the deadline for objecting is unreasonably early, and a term that lets the trader keep prepaid sums when the consumer cancels without a reciprocal right. The terms should set a renewal the consumer is reminded of, a cancellation deadline close to the renewal date, and refunds of unused periods where the trader ends the contract, so that the renewal survives the test rather than being unenforceable when challenged.

The cancellation right at the start

A subscription bought online or by phone carries a fourteen-day cancellation right under the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, which for digital content is lost only with the consumer's express consent to immediate supply and acknowledgement under regulation 37, and for services runs with a proportionate charge for what has been supplied under regulation 36. The terms and the checkout should capture the consent, and the terms should say what a consumer who cancels in the period receives back.

How a customer cancels, and the evidence

The terms should give a cancellation route in the product or by email, say that cancellation takes effect at the end of the current period, confirm it in writing, and avoid requiring a phone call, a letter or a form the customer cannot find. For business customers the terms can require written notice by a stated date, and should say what counts as notice and when it is received, because the dispute is always about whether the notice arrived.

Business customers: notice windows, minimum terms and reasonableness

For a business customer the consumer rules do not apply, and the terms can provide for a minimum term, renewal for a further term unless notice is given a stated period before the renewal date, and no refund of unused periods, subject to the reasonableness test in section 3 of the Unfair Contract Terms Act 1977 where the terms are the supplier's standard terms. A notice window of a month or two before renewal is defensible; a window closing months before it, with a renewal for a further year, is where customers argue and courts look hard.

Price changes at renewal and refunds

The terms should allow a price change to take effect from the next renewal after notice, with the customer free to cancel before it, and should say what is refunded when the trader ends the contract or withdraws the service (the unused period), when the customer cancels for the trader's breach (the unused period), and when the customer simply cancels (nothing beyond the current period for business customers, and what fairness requires for consumers). Interest on late-paid business subscriptions runs under the Late Payment of Commercial Debts (Interest) Act 1998.

What it costs

SaaS terms of service, £995. Your standard customer-facing terms. Five working days.

Buying online forms the engagement on payment. The scope is what the saas and technology contracts page describes, you accept the Terms of Service at checkout, and I email you within four working hours to get started. If you would rather ask something first, email me.

What you get

• A bespoke contract drafted for how your product is sold, delivered and supported
• Service levels you can meet, with remedies that are proportionate rather than aspirational
• A liability position that is defensible and will survive enterprise procurement
• IP and data provisions that fit together rather than contradicting each other
• A commercial note on where you will get pushback and what is worth conceding
• One round of amendments

What is not included

• Negotiating individual enterprise deals, which I quote separately
• Advice on the law of jurisdictions outside England and Wales
• Technical security certification or audit
• Regulatory advice for regulated sectors such as financial services or health

Questions I am often asked

Can we require ninety days' notice to cancel a business subscription?

You can provide for it, and it is enforceable if reasonable for the contract concerned. For a monthly plan it is hard to justify; for an annual enterprise subscription it is common. The terms set a window that fits the product.

A consumer says they never noticed the renewal. Do we have to refund?

If the renewal was clear before the contract and the reminder rules were met, the renewal stands, though many traders refund the first renewal commercially. If the terms buried the renewal or the deadline was unreasonably early, the term is likely to be unfair and the refund is due.

Do we have to let consumers cancel by clicking a button?

The rules being introduced require cancellation to be no harder than signing up. If a consumer joined online, a cancellation route online is what that means, and the terms provide it.

Related guidance and services

• SaaS and technology contracts, £995, the service this page describes
• Contract review, £495
• Data protection agreements and privacy terms, £795
• Reviewing an automatic renewal clause
• Getting an AI-drafted subscription terms checked

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: September 2026. Email geoffrey@caesar.co.uk.