From 1 September 2017 the rules are changing for anyone that charges a surcharge to customers who pay by card. Under the new rules the surcharge amount you charge cannot be more than the annual costs for processing your transactions.
Your financial institution should provide you with information on the ‘Average Annual Cost of Accepting Card Payments’. This will outline the % surcharge rate you are allowed to charge for eftpos, Debit MasterCard, MasterCard Credit, Visa Debit, Visa Credit and American Express.
Depending on what kind of transactions you process, you will need to consider if you apply a flat rate to all transactions, or you may wish to apply different rates to different transaction types.
Example of options
You can apply one rate to all credit & debit card purchases, if you choose this option you will need to apply your lowest annual cost of acceptance, e.g. 0.85%.
You can choose to apply different rates for processing debit cards and credit cards, so long as you apply the lowest annual rate for each type.
In this case, option 2 would ensure you recover as much as possible as you process different types of transactions.
You should check with your bank or financial institution for further details on how this change impacts you specifically.
Please contact Alysha Berryman of our office if you would like any assistance reviewing your credit card charge out rates.
DISCLAIMER: The information on this website and the links provided are for general information only and should not be taken as constituting professional advice from Hall Browns Accountants. You should consider seeking the appropriate legal, financial, or taxation advice to check how the website information relates to your unique circumstances.