charging customer for card processing fee.

[Michael Barnes]

I accept various payment methods including GoCardless, iZettle and WorldpayZinc and I'd like to be able to associate the fees these companies charge me with the customer invoice/payment so the profitability of the invoice is accurately reported.

I know I could just put the payment through against their invoice for the full amount and then just put the fee through as a payment to the processing company but doing it this way doesn't record that fee against the customers account so the profitability of the invoice is not accurate.

Does anyone know of a better way of doing this so I can associate the card processing fee with the particular customer invoice/payment?

Thanks
Mike

 

[kevin.doran]

You want to monitor, on an invoice by invoice basis, the true profitability of said invoice? What software are you using?

 

[Michael Barnes]

You want to monitor, on an invoice by invoice basis, the true profitability of said invoice? What software are you using?

Sorry subject is wrong it's not about charging customers is just about accounting for the card processing fees so I have a paper-trail of which customer/payment the fee applies to. With regards to your question, yes it would help if I mentioned the software - Quickbooks Pro 2016

 

[kevin.doran]

I don't use Quickbooks personally but i'd have thought if you want that level of detail you'd have to create separate 'projects' then make sure all income/expenditure is listed under that specific project. You could then pull a project report giving you a detailed breakdown.

I think you're potentially making a bit of a rod for your own back here though, given the fees are negligible and should already be costed into your top line, the fact client X has cost you 50p in fees whereas client Y was £1.25 really shouldn't matter all too much. I use GoCardless with a few clients these days, all fees go to a 'GoCardless Fees' account within the P&L but I certainly don't analyse them on a line by line basis to see how profitable a particular invoice was on any particular month. If one p[articular fee stuck out like a sore thumb I might well question it but even that's unlikely given GC cap their fees at £2 per transaction.

 

[Michael Barnes]

I don't use Quickbooks personally but i'd have thought if you want that level of detail you'd have to create separate 'projects' then make sure all income/expenditure is listed under that specific project. You could then pull a project report giving you a detailed breakdown.

I think you're potentially making a bit of a rod for your own back here though, given the fees are negligible and should already be costed into your top line, the fact client X has cost you 50p in fees whereas client Y was £1.25 really shouldn't matter all too much. I use GoCardless with a few clients these days, all fees go to a 'GoCardless Fees' account within the P&L but I certainly don't analyse them on a line by line basis to see how profitable a particular invoice was on any particular month. If one p[articular fee stuck out like a sore thumb I might well question it but even that's unlikely given GC cap their fees at £2 per transaction.

Sorry for not replying sooner. GoCardless isn't really an issue as the fee is negligible and capped at £2 but card payments are different as we're charged 2.75% and on some of our products such as Desktop Computers our profit margin is so small the 2.75% can make a big difference. That said, I think you're right in saying that I'm probably making things more difficult for myself than I need to, at this point in the business I don't really need to know that level of detail, as long as the overall job is profitable.

 

[Karimbo]

you should just treat it as a general overhead like H&L, general cost of doing business like most people do..

Also stay away from low profit margin businesses. If you're profit margin is so slim (less than the cost of payment processor, why would you even waste your time in this). If profit margin in 2.5% It just takes 1 returned item/faulty item to knock out the profit generated from 40 computers. Madness.