Credit card surcharge

[Wembleycricket]

We are hoping to pass on square's fees to our customers when they pay with card, is there an easy way to do this in the app?

[Callum]

Hi @Wembleycricket, and welcome to the community!

At the moment, there isn't a surcharging option in the Square Point of Sale app, and it's not currently on our roadmap for development. Should you decide to apply a surcharge, it is your responsibility adhere to Australian regulations as set out by the ACCC.

We would always recommend that if you're wanting to pass on the cost of our fees to your customers, we'd recommend factoring this into the final pricing of your product or services.

[Paulie]

Hi 

My GST swith was on, and I currently did some labour for a client, and I am not registered for gst because my income is below the gst limite, so I was short changed in the total of my work, were does my gst go and how does it reach the ATO ?, and how can I recieve it back to my account ?

thank you 

Paul form Western Australia 

[Seamus]

Hi @Paulie,

Thanks for getting in touch.

The good news is that you won't have been short changed for the transaction - Square does not take tax on behalf of the ATO, and we transfer the full amount of your transactions (minus our card processing fees) into your bank account in your deposits. 

We do display a net sales figure minus GST in your emailed sales report - however this amount is NOT deducted from your deposit. We highlight net sales minus GST for bookkeeping purposes only - so you know how much to put away for tax if you have it turned on.

So having GST turned on or off has no practical impact on the amount of money you'll receive from transactions processed through Square. They key difference is that if GST is turned on your receipts will mention that the amount is GST inclusive (and we'll show this in your sales reports as above). If you're not registered to take GST then you won't need to set anything aside for the ATO - you'll just need to remember that the GST amount in your first transaction was included erroneously.

By default, GST is turned on for Australian Square accounts. If you'd like to turn GST off, simply follow the steps at https://squareup.com/help/au/en/article/5061-add-goods-and-services-tax-gst-and-modify-your-tax-setti....

Hopefully this all makes sense, let me know if you have any questions or need clarification 👍

[Tracie18]

Hi Square, I would also like to show support for adding the square Fee into the charged amount. This would be very handy. As we take both cash and card transactions I currently will need to load each item in twice to cover for the card fee but still give cash a different amount. 

Any my suggestions on how to make this simpler?

[Seamus · Accepted solution]

Hey @Tracie18,

Thanks for reaching out!

At the moment Square doesn't have an automatic surcharge feature - we actually advocate for going completely surcharge free, and simply build card processing costs into the overall price of your goods/services in the same way you would for general business operating costs such as staff, rent and utilities.

If you would like to pass on credit card processing charges to your customers, you can use the following to manually calculate what you would charge.

For transactions put through a Square Reader at 1.9%:
Transaction amount divided by 0.981
e.g. $100 / 0.981 = $101.94 - you'd add $1.94 as a 1.9% surcharge.


For “Card not Present” transactions at 2.2%:
Transaction amount divided by 0.978
E.g. $100 / 0.978 = $102.25 - you'd add $2.25 as a 2.2% surcharge.

Why Wouldn’t I Just Add 1.9% or 2.2%?
Square’s card processing fees are based on the overall transaction amount, so if you’re adding $1.90 to a $100 transaction, the transaction becomes $101.90, not $100. Using the above formulas accounts for this small change to the overall fee on transactions if you’re adding a surcharge.

Hope this helps, let me know if you have any questions!

[Status888]

Hi Seamus,

I believe the US version has an option to add the Credit Card Surcharge by going through the Dashboard, Business, Device and so forth but this is not available in the Australian version?

[Arie]

Hey @Status888, 

Thanks for writing in and welcome to the Seller Community 😊 👋

It sounds like your referring to Services Charges, which are currently available in the US only. At this time, this wouldn't work as a fee surcharge option in the US, either - as service charges can be either percentage, or dollar based, but the US processing fee for card payments on a Square Reader, for example, is 2.6% + 10 cents. For now, using the workaround @Seamus shared above would still be the best way to calculate a surcharge. I know how popular the surcharge function surcharge is, and want to assure you we're still advocating for this request! 

[LunchBar]

So what happens if they pay cash? Are you saying we need 2 price points in the system for each product - 1 showing with a surcharge and 1 without?

[Arie]

We actually suggest to not implement any surcharges, @LunchBar, and factoring card processing costs into the overall pricing, like you would for other operating costs e.g utilities, rent, or staff. 

[Glimmerati]

With the current regulation changes in Australia, we are required by law to show credit card surcharges on the invoices to clients. We are also required to report the surcharges as an expense in our BAS (and hence claim back the GST component). It may be worth revisiting this functionality as many of us in Australia may get caught out down the track if not accounting for the fees correctly.

I had set up the surcharge as an additional tax but now my accounting has become very confusing as at first glance I can't see the taxes split out separately so am reverse engineering it.

[execva]

I'm not an accountant but couldn't you include the surcharge as an additional line item on the invoice? I'm not sure what your business is but I'm thinking in my case since I send invoices to clients at the end of the month, it would be a line item for the service; then an additional line item for the 'credit card surcharge' amount?

eg:

Service .... $100.00

Surcharge 2.2% .... $2.25

Total ... $102.25

(I don't charge GST so I figure that's an additional complication.)

Lyn

PS: I just trialled adding a credit card surcharge as a line item on my service invoice manually at 2.2%. No matter what I do I always end up losing a few cents each transaction as the 2.2% is charged on the total invoice. So on a transaction of $575 for example, I added a CC surcharge at 2.2% = $12.65 - taking the total invoice to $587.65. Assuming this is paid and Square now takes its processing fee of 2.2% on $587.65 this fee is actually $12.93 - so I've immediately lost 28c on this transaction .... .... this means that even if I build the charge into my price as suggested here by Seamus, I still lose that 28c..... and BTW that seems a LOT for the ability to pay by credit card....

[MiaBB]

Unfortunately that does not work for us as we process hundreds of transactions a day have GST & non-GST items. This would not be feasible for a high volume business

[Mmp74]

I am really disappointed thta this and many threads like this have been around for years and Square continues not to listen to the people who use it!

For a big tech company it seems to not be able to add a button for the card processing fee or even a % button is a bit weak. Many other companies seem to be able to incorporate this. Zellar is one, Smartie is another.

Can this not be raised to higher people or even do a survey on this topic.

I have been a member for many years and do enjoy using square but this form style does not solve any issues. 

cheers

[BernadetteA]

I do not have any updates at this time, @Mmp74

I did stumble across this Square Fee Calculator that was shared through the support teams that may help you out for now. 

Thanks for sharing you feedback!

[BillyEdwards]

No this is the most ludicrous answer... you are advocating that we put all prices up and that cash payers will pay for the credit cards .. 

May you be the first to be gobbled by big brother

[Fishcoop]

Hi Seamus, 

There is a growing number of businesess that wish to pass on eftpos fees given the massive growth in eftpos transactions and fees since covid and the the ability to pay with smart phones and wearables. i would strongly suggest that square get on board with customer demand ie merchants in this case and add the ability to surcharge for eftpos transactions. 

thanks

Nathan

[execva]

So we're clear here let's use 2.2% as the Square charge. So the options are:

• Charge the customer $100 - and wear the 2.2% fee as a cost of sale - ie $2.25 is paid by the merchant as a cost of sale fee
• Charge the customer $102.25 - which incorporates the 2.2% fee however Square will then charge 2.2% on $102.25.

My maths isn't good but does the second option mean the full $100 charge is available to the merchant? Not that Square actually earns more in fees because the total charged is more than the service invoice? It looks like it does but this has always been something that confuses me!

Lyn

PS: I just trialled adding a credit card surcharge as a line item on my service invoice manually at 2.2%. No matter what I do I always end up losing a few cents each transaction as the 2.2% is charged on the total invoice. So on a transaction of $575 for example, I added a CC surcharge at 2.2% = $12.65 - taking the total invoice to $587.65. Assuming this is paid and Square now takes its processing fee of 2.2% on $587.65 this fee is actually $12.93 - so I've immediately lost 28c on this transaction .... .... this means that even if I build the charge into my price as suggested here by Seamus, I still lose that 28c.... and BTW that seem a LOT for the ability to pay by credit card....

[v93oqBrQD4t]

Hi - You are advocating for no surcharges but YOU guys are the people implementing these charges. This is very ironic.

Its not as if your customers (we) are trying to take advantage of people - we just want to recover the costs of doing business.

Our payment transactions are not face to face so we can't add in a 2.2% fee to the payment manually.

Long term this will be an issue for us and we would need to consider other payment providers.

Thanks

Tim

[Fishcoop]

you have to add it as a tax on all items. it doesn't help if you use the software for taking cash payments as well. i only use it for eftpos and it suits me fine. it's not perfect because square take 1.6% of the 1.6% percent charge  but it's close enough.

[splurben]

For very many of us, the surcharge isn't the issue. For those of us using integrated products, we have edit every single transaction or they won't reconcile, I use Xero and I have to edit every single transaction before I can reconcile.

I want the surcharge included so that the amount that comes back from Square integration will match the invoices in my Xero system. This ain't rocket science, we go to Xero and Square to make our lives easier. 

It appears that Square has an axe to grind with integrated products like Xero and integrating surcharges is a bugbear in some executive wigs at 'Corporate'.

Also, the ACCC regulations are a complete non-sequitur in this argument because is you just added the option for surcharges to be automated, there would be no question that ACCC regulations are being followed.