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

Forum|Forum|6 years ago
May 22, 2020
21 replies
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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!

Show previous replies

L

Larissag

I understand the process of adding the fee as a line item however when I email the customer the invoice I do not necessarily know if they will pay via check or credit card. So how do I get the customer to pay the fee IF they decide to pay with a credit card? Does QB allow the fee to be added ONLY IF they choose credit card?

MJoy_D

I can share some information about processing customer payments in QuickBooks Online (QBO), @Larissag.

When you send them an invoice, they can choose to pay you using a credit card, debit, and ACH bank transfers for invoices you send. You may verify with your customers how they'll send you the payment. Once you've confirmed that they'll be paying you via credit card, you may include the fee in the invoice you'll be creating.

Check this article for more information about processing customer payments in QBO: Take and process payments with QuickBooks Payments.

The option to set or add the fee when the customer chooses to pay via credit card is currently unavailable. That would be a great addition to the current features that we have, so I'll take note of it. For now, you can visit the QuickBooks Blog to check for new updates and features that we have.

Here's an article that will walk you through adding a fee to an invoice, whether you've already submitted it or not: Add service fees manually to invoices.

I'm also adding this resource to know more about recording invoice payments: Record invoice payments in QuickBooks Online.

Let me know if you still have follow-up questions about customer payments or any other concerns. I'll be there to help in any way I can. Have a wonderful day!

C

charging credit card fee

QuickBooks

Get off your and add a processing fee option when our Customers pay by Credit card fees !!! This is a basic 101 Programer job so get it done !!

Or it may be just Quit QuickBooks movement

R

RCV

Thanks for sharing your sentiments about accepting and charging the customer's credit cards payment with the fee, propertihc, and wireman121.

I know how beneficial it is to your business to charge customers credit card processing fees. However, this option is unavailable in QuickBooks Online (QBO). With this said, I'd recommend sending this request straight to our product engineers through feedback. Sharing features and options that you would like implemented is how our engineers look for new product updates. Here's how:

Go to the Gear icon at the top.
Select Feedback.
Enter your comments or product suggestions.
Then select Next to submit feedback.

You'll want to check for a third-party application that can help you with this one. You can check out the apps that are compatible with QuickBooks at this link: https://quickbooks.intuit.com/app/apps/home/. We can also do it in QBO by following the steps below:

Go to Apps on the left side menu.
Search for the app in the Find apps to streamline your work field.
Look for the app that supports the Batch Invoicing feature.

For future reference, here are some of our resources that can guide you more about accepting credit cards in QuickBooks:

For more tips and other resources, you may visit our page in managing your business in QuickBooks: QBO Self-help articles.

The Community always has your back, and I'm just a post away should you ever need anything. Just leave a comment below and I'll get back to you. Have a great day ahead.

J

jerbaldw

Why don't your product engineers have some due diligence and read the messages on here. Go blow some smoke somewhere else.

N

Nick0172

I'm so incredibly disappointed. The QBO "Payments" department sent this article to me. They said that it provided instructions on how to correctly charge the client the interest and fees in a way that would eliminate additional charges to my company. Alas, these answers are exactly what we have been doing. Adding line items and tracking them separately.

As many people have already pointed out, this does not stop the interest from being charged on the new total.

Line 1). Services | eCommerce power boosting wizardry | qty 2 | amount 5,000 | total 10,000

Line 2) 3rd Party chrgs/fees/interest | QBO CC invoice interest 2.9% | qty 1 | amount 290 | total 290

Line 3) 3rd Party chrgs/fees/interest | QBO transaction fee | qty 1 | amount 0.25 | total 0.25

Total $10,290.25

Because I've listed the charges as line items on the invoice they are included in the invoice total. As you can see the additional fees that I righteously charged the client were $290.25. But, because I'm being charged 2.9% on the Invoice Total of $10,290.25 (not just "Line 1") Quickbooks charges back to me a total of $298.95. In essence, I'm being over charged 0.0087%.

0.0087% might not seem like a lot of money at first glance. But, many of my clients are cash strapped when they come to me for help. If I collect $1M in a year and half of that ($500k) is paid via credit card then, I was just overcharged $4,350.00. I'd much prefer to reinvest that money back into my company.

We're all asking QBO to find a more elegant solution... if they can. Idk how since the 2.9% interest is charged by the credit card company, not by QBO. So, the cc company doesn't care what the line items are.

Maybe QBO could broker a deal with the cc merchants? Maybe, QBO can auto refund the 0.0087% back to clients who can show it on their P&L. Then, QBO could charge it back to the cc merchant. ??? That would take work. But, we'd certainly all appreciate it.

M

MirriamM

I appreciate your input from every angle, @Nick0172.

We recognize that each company has unique needs, and I can see how the feature you're looking for would benefit and empower your business. In the meantime, I recommend sending this request straight to our product engineers through feedback.

To send feedback, follow the below steps:

Go to the Gear icon at the top.
Select Feedback.
Enter your comments or product suggestions.
Then select Next to submit feedback.

To be updated with the recent and upcoming changes for QuickBooks products, visit these sites:

If you need anything else, please let me know. I want to help in any way I can.

W

WeFixDMD

I need accounting software that automatically charges the processing fees to the customer. Intuit seems to have been unable to figure this out for several years. The processing fees are making QB non-viable for me. Can anyone out there recommend another product?

A

ATX78730

So...if we decide to calculate the processing fee and manually passback the processing fee on each invoice, does the Visa and MC merchant surcharging notification rules apply? https://usa.visa.com/support/small-business/regulations-fees.html#2 Has anyone followed this process?

K

Kruger Interiors

I totally think this should be a simple toggle switch when creating the invoice: Pass CC Fee to Customer? Plus, if a customer chooses to use a different form of payment, they don't have to incur the fee! Quickbooks- get this done!

Adrian_A

Hi franklinserve12458 and Kruger Interiors.

I can see how easier to have the option to switch to a different payment mode and a button to toggle the credit card fee to the customer.

That said, I'd suggest sending Feedback to our developer's team. Your valuable suggestion goes to our Product Development team to help improve your experience in QBO. Here's how:

Click the Gear icon.
Select Feedback.

You can visit this page to track feature requests through the QuickBooks Online Feature Requests website.

Also, to ensure your record match your bank statement, you can reconcile the transactions. Here's an article as your guide: Reconcile accounts.

I'm just around whenever you need help with the reconciliation process.

J

juliehwtucker

We use QB POS and decided yesterday to Add a tax code of 3% and named it "card fee"

So when a customer checks out if they are using a card. We toggle the tax to "card fee"

The "tax" was setup as a multiple rate.

6.5%state

.5% county

2.125% City

3% card fee.

It is way faster than manually adding an item and correct as far as math and coding the money.

Can look daily/weekly/monthly/annually and see how much was collected. The way I see it. It is more than getting $0 from the customers and easier for the clerks to do.

C

CMD08

How are managing your accounting for this on the back end? All the credit card fees you have collected will look like taxes that need to be paid, and your charges from QB are still going to show as full amounts that you have paid them. Just wondering how to check and balance this situation.

O

odbc1

Aloha,

I am not sure how you are setting up your books to record the fees..... but I created a line item called "Merchant Processing Fees" that I can add to an invoice, and it is linked to an expense account... the same one that I set up previously to use for all of QB fees that they charge through Merchant Services. Theoretically the credit card payment fee from the client and the merchant service fee would "wash" each other out, and my P&L would show a $0 balance on that expense account [601-01 QB Merchant Fees]. We do absorb the $3.00 flat ACH fee, but the card percentage on a $30K payment would be hard to absorb. Taxes accumulate in a liability account because we are holding them as a tax liability. Hope this helps.

MonicaM3Answer

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!

G

gmadmoney

It's not solved. Your solution is knowing that they ARE going to use a credit card. People on this thread need that option based on their choice. I can't add the fee and then they pay with a check. Nice try but that's not the answer.

A

ATX78730

Upvote and agree. This has been an UNRESOLVED issue since the original post in 2020. Covid didn't take that long...

J

Jaseem

I work with PayorCRM which automatically charges a CC processing fee when the customer pays via card only.Let me know if you are still looking

Jaseem

PayorCRM

S

safaricarl

This is absolute madness QBO! Probably the worst customer service I have seen in years. So many software's have this feature built-in - I shouldn't have to add additional line items to the invoice in order to have my customers pay this fee. 2.99% on $10k jobs is a lot of money.

C

CLikzD

I found a product called Biller Genie. This integrates with QB, and you can use a 3rd party payment processor. Your invoices will go from QB to Biller Genie and then to the client. If the client chooses to pay via CC, they are charged the fee you want to charge. If they pick EFT the rates can be as low a 0.5% not 1%.

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