How do I charge Afterpay sales so my business does not lose money off the net total?

[ace66]

The title of this thread has been edited from the original: How do i process Afterpay so my business does not lose mobey off the net total

I put through an afterpay this afternoon adding the 6%+30c as per instructions but when I looked at my main page it tells I will still end up losing almost $10 off my net total in fees!  Why?? 

[Katie_SQ · Accepted solution]

Hi @ace66, 

Square's payment processing fees are deducted from the total transaction amount, which includes tax and tip. The Afterpay processing fee is 6% of the transaction amount plus a fixed fee of 30¢ (excluding GST) per Afterpay sale. So if you were to charge $1,000.00, a total of $60.30 will be deducted in fees before the remaining balance is added to your Square account, leaving you with a net total of $939.70.

To ensure that you cover your Afterpay costs and receive the full amount you intend, you'll need to add an additional 6% plus 30¢ to the price of your sale.

For example, to receive exactly $1,000.00 in your Square balance after fees, you should charge approximately $1,064.15. Here's the breakdown:

• Desired net amount: $1,000.00
• Add 6% fee: $63.85
• Add fixed fee: $0.30
• Total fees: $64.15
  
  

Therefore, the total amount you would need to charge is $1,064.15. This ensures you cover the Afterpay fees and receive your intended net amount.

I hope this explanation helps! If you have any further questions, please feel free to ask.

[ace66]

it sort of helps. our desired net amount was $936 (total of customers invoice)

adding the 6% fee $56.16 and the fixed $0.30  had our total to the customer at $992.46(this is amount I put through )

so in theory we should have got the amount of $936 (desired net amount) today when it lands in our account.

Instead we will get $926.63!  how do we lose / pay an extra $9.37 and why??  our business does not earn enough to claim GST  so I am at a loss as to why we got slugged this extra amount??

[Katie_SQ]

Sorry for the delay getting back to you here @ace66!

If the total amount charged was $992.47, then the fees would be $59.85 (6% + $0.30 = $59.8482, then rounded up), resulting in a net amount $932.62. It sounds like there was tax on those fees of $5.99, resulting in a transfer amount of $926.63.

Taxes on fees are what Sellers will eventually pay for the GST cost of their transaction fees. Square provides you with a monthly tax invoice to help you claim the Goods and Services Tax (GST) paid on your processing fees. These fees have already been deducted from your account and are not outstanding. If you process any card payments through Square in a calendar month, Square will provide you with a tax invoice in your online Square Dashboard on the fifth day of the following month. Find answers to frequently asked questions about monthly tax invoices here.

You can also view these fee types from your Balance reports in your online Square Dashboard.

I hope this is helpful, but please let me know if you have any other questions. 😊