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Merge pull request #225640 from bandersmsft/ghissue104032
MCM - Update for ghissue 104032
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articles/cost-management-billing/reservations/understand-rhel-reservation-charges.md

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ms.service: cost-management-billing
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ms.subservice: reservations
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ms.topic: conceptual
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ms.date: 12/06/2022
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ms.date: 01/30/2023
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ms.author: banders
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---
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# Understand how the Red Hat Linux Enterprise software reservation plan discount is applied for Azure
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Like Reserved VM Instances, Red Hat plan purchases offer instance size flexibility. This means that your discount applies even when you deploy a VM with a different vCPU count. The discount applies to different VM sizes within the software plan.
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The discount amount depends on the ratio listed in the following tables. The ratio compares the relative footprint for each VM size in that group. The ratio depends on the VM vCPUs. Use the ratio value to calculate how many VM instances get the Red Hat Linux plan discount.
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The discount amount depends on the VM vCPU ratio listed at [Instance size flexibility ratio for VMs](../../virtual-machines/reserved-vm-instance-size-flexibility.md#instance-size-flexibility-ratio-for-vms). Use the ratio value to calculate how many VM instances get the Red Hat Linux plan discount.
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For example, if you buy a plan for Red Hat Linux Enterprise Server for a VM with 1 to 4 vCPUs, the ratio for that reservation is 1. The discount covers the Red Hat software cost for:
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