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Compound rebates

A compound rebate is a top-up: it calculates its full amount as normal, then deducts what another named element has already paid the member for the same window, and pays only the difference. Use it for elements like "guarantee the member ends up with 3% overall" layered over a smaller base rebate.

How it calculates

  1. The element calculates normally — banding, rates, output type — giving a gross payable per member per period.
  2. The engine then sums what the compound target element produced for the same member and window. For lines already marked paid it uses the actual paid amount; for unpaid lines it uses the calculated payable.
  3. The deduction is subtracted: payable = gross − target element's amount. The result never goes below zero — a compound element cannot claw money back.
  4. On a catch-up compound element the deduction window is the whole element-to-date rather than just the current period.

Example. Element R1 pays 1.5% (base). Element R2 is a 3% rebate compounded against R1. A member does £100,000: R2's gross is £3,000, R1 has paid £1,500, so R2 pays £1,500 — topping the member up to exactly 3% overall. If R1's rate had been 3.5% (£3,500), R2 would pay £0, not −£500.

The deduction and the payable are tracked separately for supplier-facing and member-facing values on in/out rebate sites.

Why does a compound rebate change unexpectedly?

  • The target element changed — its recalculation, a band crossing, or a manual payment against it alters the deduction even when this element's own turnover is unchanged.
  • A target line was marked paid with an amount different from its calculated payable: the deduction switches from the calculated figure to the actual paid amount.
  • The gross fell below the deduction — the floor at zero makes the element suddenly pay nothing rather than go negative.

What a compound rebate is not

  • It is not a strung rebate. Strung reduces the turnover the element measures or pays on before calculating; compound calculates on full turnover and adjusts the final amount. A compound element bands on gross turnover; a strung element may not.
  • It is not a cap on the target element — the target always pays in full; only this element's payable shrinks.