Repurposing Taxes function on Invoice to pass CC fees onto Clients?

Hi Casey! 👋 I wouldn’t recommend repurposing the tax line item for that as it’ll most likely mark the item as taxable and affect her sales tax reporting, even if she doesn’t collect tax. I’d recommend using the service charges line item and adding it in as a line item on the invoice. That’s probably what she’s doing in QB anyways. 

I would love to have the processing fees be put on the client, there is a website called Maroo where you can do that with a client and I have been doing that I just wish HoneyBook would adapt and have all my things in one place. 

Hi Amanda! 👋 I wouldn’t recommend repurposing the tax line item for that as it’ll most likely mark the item as taxable and affect your sales tax reporting, even if you’re not collecting tax. Maybe you could bill it as a service charge line item on the invoice, if you’d like to go that route. You may just want to check with your state/federal laws, sometimes depending on location, it’s illegal to pass the payment processing fee on to the client. 

I am not adding the processing fees in my tax line. And my state is it not illegal. But maybe I would have to add another invoice for processing fees that’s just a little inconvenient for me and my couples. My couples would prefer to have one price to pay and not see additional fees on their invoice. 

Thank you - that’s what I’ve recommended in the past. We’re trying to figure out a way to automate it though, since it’s a percentage, not a flat fee. Currently HB doesn’t have a way to calculate a percentage on the total invoice like this except for in that area.

Have you or any of your clients looked at how this field shows up in Quickbooks? Do you know if it will show up as a tax payment?

Hi Casey! You’re welcome. Yes, when I tested it, it marked the item as taxable, though no sales tax was collected since the line was used for something else, and it was reported as a taxable sale on the  tax report in QB, even you’re not actually collecting tax/have no tax was attached to it on the report, the sale amount was reported as such. 

Maybe looping this fee into your pricing and accounting for it that way helps. Though it wouldn’t be segmented out on the invoice, it would be something you know it’s already included in your price even if it’s not visible/evident to the client. When looking at your packaging and pricing, account/add maybe 5% of it for payment processing fees as a cost of goods sold and then up your pricing by that much. If you’re charging $2,500, maybe up that to $2650 (for example) to include an approximately 5% of payment processing fees. Just an idea!