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Ritchiec80
November 20, 2020
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Taking card payments when the fee is charged before payment

  • November 20, 2020
  • 1 reply
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As part of my business I send a lot of invoices that are often paid in 2 parts, currently I use First Data for card payments which means that when someone pays their invoice via card the full amount is paid into my account so I can add it to the invoice via Quickbooks, the fees are taken monthly on all card sales.

I'm looking to switch to either iZettle or Sumup but these companies take their transaction fee before they pay you you meaning if I take £100 they might pay me £97.50 or something like that, my question is how can I track this as if I add that against the invoice it will show as £2.50 being outstanding.

How can I track this to keep the tax man happy and avoid confusion on who owes what.

Best answer by Jen_D

Thanks for joining the conversation, @Ritchiec80,

 

I can share the steps on how to handle bank or credit card fees in QuickBooks Online.

 

This process may require a few steps to do, so I'll be outlining everything for you.

 

Step 1: Create the customer invoice. In your case, the $100 receivable.

  1. Click the Plus (+) icon.
  2. Select Invoice.
  3. Enter the exact amount to be invoiced. (See screenshot below)

 

Step 2: Receive the full payment of $100. This is to replicate the amount taken from the customer and the income in your Profit and Loss.

  1. On the invoice, click the Receive Payment button.
  2. Select the correct invoice on the Receive Payment screen.
  3. In the Deposit to field, choose Undeposited Funds.
  4. Click Save and close. (See screenshot attached)

 

Step 3: Enter a Bank Deposit for the fee to relieve the balance from Undeposited Funds account to bank account. This process is important, because here we deposit the amount cleared in the bank after deducting the fees. 

  1. Click the QuickBooks Plus (+) icon.
  2. Select Bank Deposit.
  3. Mark the invoice payment you received previously from the Select the payments included in this deposit section.
  4. Expand the Add funds to this deposit section to add a new line item.
  5. In the Received From column, enter the credit card fee as a vendor.
  6. In the Account column, add an expense account for the fee.
  7. In the Amount field, enter a negative fee amount. Example, -2.50.
  8. Make sure the deposit matches the net bank deposit amount.
  9. Click Save and close.

 

Please let me know if you need further assistance with recording fees. I'll be available to help you anytime. Have a great day!

1 reply

Jen_D
Jen_DAnswer
November 20, 2020

Thanks for joining the conversation, @Ritchiec80,

 

I can share the steps on how to handle bank or credit card fees in QuickBooks Online.

 

This process may require a few steps to do, so I'll be outlining everything for you.

 

Step 1: Create the customer invoice. In your case, the $100 receivable.

  1. Click the Plus (+) icon.
  2. Select Invoice.
  3. Enter the exact amount to be invoiced. (See screenshot below)

 

Step 2: Receive the full payment of $100. This is to replicate the amount taken from the customer and the income in your Profit and Loss.

  1. On the invoice, click the Receive Payment button.
  2. Select the correct invoice on the Receive Payment screen.
  3. In the Deposit to field, choose Undeposited Funds.
  4. Click Save and close. (See screenshot attached)

 

Step 3: Enter a Bank Deposit for the fee to relieve the balance from Undeposited Funds account to bank account. This process is important, because here we deposit the amount cleared in the bank after deducting the fees. 

  1. Click the QuickBooks Plus (+) icon.
  2. Select Bank Deposit.
  3. Mark the invoice payment you received previously from the Select the payments included in this deposit section.
  4. Expand the Add funds to this deposit section to add a new line item.
  5. In the Received From column, enter the credit card fee as a vendor.
  6. In the Account column, add an expense account for the fee.
  7. In the Amount field, enter a negative fee amount. Example, -2.50.
  8. Make sure the deposit matches the net bank deposit amount.
  9. Click Save and close.

 

Please let me know if you need further assistance with recording fees. I'll be available to help you anytime. Have a great day!

T
TraceyGoldman
December 16, 2020

This explanation is a LOT of work to do daily and then split across multiple invoices.

 

There must be a more simple approach to associate the fee to an expense account called SumUp.

A
Ashleigh1
December 16, 2020

Hello Traceygoldman, 

 

Thanks for posting on this thread, 

 

The steps above in this post are how to record the transactions in Quickbooks, there is no other way to record them in your account. 

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