Merchants in the UK are responsible for adhering to all regulations regarding imposing a surcharge on consumers when a card is used for payment. It is unlawful for merchants to impose surcharges for payment processing exceeding their own direct processing costs.
The following states prohibit surcharges of any type: Colorado, Connecticut, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas
Calculating Surcharge Fees
Square’s fee is taken out of the total amount of the transaction, including tax, tips and any added surcharges.
The following is an example of a swiped £100.00 payment with an added surcharge.
Let’s say you added a surcharge of £1.75 to account for Square’s swiped card fee: £100 + £1.75 = £101.75
If you charge your customer a total £101.75, Square’s fee will be applied to the total payment: £101.75 x 1.75% = £1.78
To determine the deposit you’ll receive for this payment, subtract the fee from the total payment amount: £101.75 – £1.78 = £99.98
Following this example, £99.98 will be deposited to your linked bank account.
Some merchants have found third-party fee calculators helpful in understanding the amount to add as a surcharge. You can find these online or within the Apple App Store or Google Play.