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How do I charge customers credit card processing fee on an invoice?

Forum|Forum|6 years ago
May 22, 2020
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QuickBooks Online

Best answer by MonicaM3

Hi All!

We understand that credit card processing fees can add up and that cash flow is important to small businesses. Because credit card surcharges are handled differently in each state, the function to automatically add processing fees to an invoice is not available at this time.

Most merchant service agreements stipulate that the merchant will cover processing fees for credit card payments. However, in some cases, businesses pass these fees on to consumers in the form of surcharges to avoid incurring the additional costs themselves.

In states where surcharges are legal, they must be clearly displayed at the point of sale and on your receipt.

When a business chooses to impose a credit card surcharge, there are protocols that have to be followed, these vary by state.

If you choose to add a credit card processing fee to your invoice, you can create a service item, then manually add it to your invoice. You can also consider a third-party app and integrate it with your QuickBooks.

To begin, these are the steps:

On the left navigational bar, go to Get paid and & pay tab.
Choose Product & Service.
Click on New then select Service.
Enter the name of your service item. (Example CC Fee)
Select the account you'd use to track the processing fees.
Once done, click Save and Close.

Once done, add the credit card fee as an additional item on your invoice when you charge your customers with the processing fee.

You can also get one-on-one help for your business:
Check out QuickBooks Live.

In case you'd like to use a third-party app, here's where you can find one in QuickBooks Online:

Sign in to your QuickBooks Online Company.
Go to Apps tab.
On the search bar, type the name of the that you'd like to integrate with your QBO account.
Click the Search icon.

Let us know if you have any additional questions. We are here for you!

J

Joseph_A

I'm glad to see you here in Community, @Kterry1.

You can charge your customer the credit card processing fee by adding this to their invoices.

You can use a service item for the fee. Here's how:

Go to Sales then choose Products and Services.
Click on New then select Service.
Enter the name of your service item. (Example CC Fee)
Select the account you'd use to track our processing fees under the Income account drop-down.
Once done, click Save and Close.

Add the CC Fee as an additional item on your invoice every time you charge your customers with the processing fee.

You can also email or print the invoice you've created.

Feel free to post your additional questions here in Community. Have a great day ahead, take care.

C

cmaddox

Can I set up a line item (Credit Card processing fee) to be a percentage of subtotal [total in our case as NH does not charge sales tax].

If so, could it automatically list on al estimates and/or invoices?

S

SashaMC

Hey there,

Thank you for joining the QuickBooks Community, cmaddox. The ability to set up a credit card processing fee to be a percentage of the subtotal and automatically list it on all invoices and estimate hasn't been made available in QuickBooks Online. We are aware of how this would be a bonus to your business transactions. Therefore, our engineers are working on improving our product's features to meet your needs.

However, you could manually add a new line to the customer's invoice with a rate. Here's how:

Select an empty line below the Product/Service column.
Click Add New from the product or service drop-down.
Pick Service from the options.
Enter the description, for example, credit card processing fee, on the Name field.
Select Save and close.
Once completed, add the Rate.
Click Save and Close.

If you would like to see the latest product updates and feature enhancement, I encourage you to follow our blog.

I'm here to help you if you need further assistance with this concern. Feel free to hit that Reply button. Have a good one!

Fiat Lux - ASIA

@Kterry1

As another option, ask your client to utilize MP to pay their bills by credit card. Stretch your clients’ cash flow by creating up to a 45-day float by paying bills via a credit card, even if the vendor doesn’t accept credit cards. Vendors get paid with a physical check or with electronic bank transfers.

https:// melio.grsm.io/quickbooks

E

Em28

I would prefer it to be an option that the customer has to pick. Let them decide if they want to send a check or to pay the extra 3% to use a credit card.

Fiat Lux - ASIA

@Em28 wrote:
I would prefer it to be an option that the customer has to pick. Let them decide if they want to send a check or to pay the extra 3% to use a credit card.

@Em28

If you are using Melio, your customer can pick the payment option. They can pay your invoice by credit cards and pay the fee as well, you will get paid by bank transfer or check for free.

https://melio.grsm.io/quickbooks

A

AMmath

I just tried Melio and it did not work because the payer was not a business. Their credit card payment was cancelled. Does Melio allow individuals to pay businesses?

QUICKBOOKS LETS GO

I am wondering if I connect a 3rd party service (such as stripe) if that would handle the issue or passing the CC fee to the customer. Does anyone know?

A

aaronsmitty

not sure about stripe, have done it with other solutions before for clients though. Super easy integration, just put in quickbooks credentials & then merchant gateway key and it is set up right away. Pulls all QB data in. Super easy and all the fees are gone & all surcharges are recorded correctly inside quickbooks.

K

katie42

I just had a conversation with a quickbooks employee. It's so frustrating that after we pay monthly charges for quickbooks online and merchant services, we still get charged a percentage of each transaction. I don't understand why there wouldn't be a convenience fee that the customer chooses when the select choice of payment. Because of large payment transactions, we offer credit card and ach payment methods.. Both options have different rates.. The rate also changes based on the total invoiced amount after you include the fee on your invoice. So ridiculous...

S

Schmidt1383

Looks like we might need to move away from quickbooks. Crazy that I have to decide and change things on the invoice for card transactions.

Fiat Lux - ASIA

@Schmidt1383

You may consider using another payment processor to integrate with your QuickBooks, OR purchasing our service to convert your data from QuickBooks to another accounting app.

I

intensitybands

There IS A SOLUTION to this. Just posting to be helpful. I have nothing to gain from this, but I figured it out for my own company and thought I'd share:

If you want credit card fees charged to your customer at 3%, and you want that option as an automated thing that happens without any interaction from the user, I have accomplished this via Zapier, fairly easily. We have the invoice created automatically via Zapier when the sale closes in our CRM, but that isn't necessary. The 'trigger' can be from a CRM (Zoho, in our case), and it can be automated to create the invoice and the 3% fee line, or the trigger could be the new invoice creation in QBO, and the result could be adding a new line item with the 3% charge.

But we complete the sale in our CRM, and within seconds, the customer exists in QBO, and the invoice is created, with the optional line item adding the 3% credit card fee. The email template clearly explains to the customer that if they pay with check, to only pay the amount of the sale before the CC fee. In that event, we just delete the optional fee line and the invoice defaults to 'paid in full'.

If this interests anyone, I can give more detail as to how to complete this process. We didn't want to have to manually create the invoice, add the 3% optional fee, or email it. We just wanted ALL that to happen automagically when the sale is completed in a different application, and after a few hours of tweaking and finding the right features in Zapier, I got it working beautifully. Just throwing it out there. :)

D

DignityFireProtection

Hi There Community,

We did the same as this person (intesitybrands), added a 3% charge onto all of our invoices as a line item. Then in the email and on the line item description we write "If paying with a check, please remove this amount." It has been helping us, but a concern that I have is that Colorado Law is changing in July 2022 where I will no longer be able to do this and can only charge 2% or the EXACT amount of the Credit Card Fee.

QUICKBOOKS - With Colorado State law changing, now is the time in which you have to fix this. Colorado law will allow customers to pay the fee directly to the processor or to myself the company providing product or services, only if the charge amount is 2% or EXACTLY what the credit card processing amount is. With that law in place, and the work around that QB has given, there will be no way to accomplish charging the exact fee which is what Colorado wants. FIX THIS QUICKBOOKS.

L

Linda Z

I've read through the various posts and it doesn't seem QB has resolved this issue yet. QB, is this true? If so, when will it become a function/process that we can use? Going through a 3rd party vendor in order to accomplish this is ridiculous!

R

Rasa-LilaM

Thanks for joining this thread, Linda Z.

I can see a lot of customers are having the same needs as yours about adding credit card fees automatically on invoices. Adding this feature can save time and will enhance your online experience.

I’m unable to provide a defined time frame when this functionality becomes available. Please know that your voice is important since it will help us pinpoint the areas in QuickBooks Online (QBO) that we need to improve.

I also suggest sending this idea to our engineers for inclusion in future updates. Let me show you the steps on how to do this in QBO.

Tap the Gear icon in the upper right and choose Feedback under Profile.
This will open a window where you can enter your suggestions.
Make sure to key in your feedback in the field box.
Click Next to submit it.

You can browse through the following articles to learn more about credit card processing. From there, you’ll learn about fees, regulations, and requirements that come when you accept credit cards.

Feel free to post a comment if you have any clarifications about charging fees. I’m more than happy to lend a helping hand.

F

Four Directions

I've read through this thread, and several others exactly like it, dating back many years. QBO is obviously aware of this critical customer request, and is choosing to ignore it. This is clearly not an engineering decision / difficulty because several third-party startups, without a fraction of QBO's resources, are able to implement this simple feature. The exclusion of this feature is entirely about greed. Like many others across this community, I am compelled to find an alternative business accounting software that respects its customers. QBO, can you feel the tide turning?

Fiat Lux - ASIA

@Four Directions

If you are running a B2B company, you can use another payment processor to integrate with your QB. You can choose who pays the credit card fee (2.9%, tax-deductible). By default, the fee is charged to your customer and is added directly to the payment they send you.

F

Four Directions

Thank you for the quick reply. I really appreciate that.

I actually just tried Milo based on the information provided in this thread. The problem with that service is even when using "Guest Checkout" your client will have to essentially set up a profile to use the service. It's not as simple as just entering credit card or bank details. They have to enter a bunch of information. It's much more time consuming, which creates an inconvenience barrier to paying invoices. Is there another service that you recommend that streamlines the process for paying invoices?

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