It's wild that Xero and Stripe can't just surcharge exactly what it would cost to process. The maths isn't even hard at all.
Read this as well if you haven't already: https://central.xero.com/s/question/0D58V00008uqRguSAE/gst-on-stripe-fees And my comment:
This is wild. Interesting to finally have the context around Xero Inc and how they dodge GST.
This causes a plethora of issues, that Xero will say is not their problem, including:
- businesses incorrectly claiming GST on the fees. You only know you're not being charged GST because of a tiny fineprint under the Payment Services section. Then Xero gives you the option to automate my fees, and all you have to do is select an account (so you select Merchant Fees - which it is). Now Xero automatically creates the transactions for the fees, incorrectly, using GST on Expenses. Lol. Xero will say "it's up to the business and their accountant to determine the GST treatment". Yeah, but Xero says would you like us to automatically create the fee transactions for you? Yeah, cool, we'll do that but won't take any responsibility that it's correct, nor let you know how we decide on the tax rate we use ;) hehe
- businesses losing money when surcharging their customers or being non-compliant with ACCC. If I want to surcharge and my original invoice had GST on Income, my surcharge should be GST on income. Now my surcharge is $10.00 and the Xero/Stripe fee was $10.00. I pay my $1.81 GST to the ATO and I don't get a $1.81 GST credit, so I lose out. Alternatively, I make my surcharge $11.00 and now I'm break even, but the surcharge is more than the cost to the business, so I am not compliant with ACCC
Sam Gray
supported this idea
·
It's wild that Xero and Stripe can't just surcharge exactly what it would cost to process. The maths isn't even hard at all.
Read this as well if you haven't already: https://central.xero.com/s/question/0D58V00008uqRguSAE/gst-on-stripe-fees
And my comment:
This is wild. Interesting to finally have the context around Xero Inc and how they dodge GST.
This causes a plethora of issues, that Xero will say is not their problem, including:
- businesses incorrectly claiming GST on the fees. You only know you're not being charged GST because of a tiny fineprint under the Payment Services section. Then Xero gives you the option to automate my fees, and all you have to do is select an account (so you select Merchant Fees - which it is). Now Xero automatically creates the transactions for the fees, incorrectly, using GST on Expenses. Lol. Xero will say "it's up to the business and their accountant to determine the GST treatment". Yeah, but Xero says would you like us to automatically create the fee transactions for you? Yeah, cool, we'll do that but won't take any responsibility that it's correct, nor let you know how we decide on the tax rate we use ;) hehe
- businesses losing money when surcharging their customers or being non-compliant with ACCC. If I want to surcharge and my original invoice had GST on Income, my surcharge should be GST on income. Now my surcharge is $10.00 and the Xero/Stripe fee was $10.00. I pay my $1.81 GST to the ATO and I don't get a $1.81 GST credit, so I lose out. Alternatively, I make my surcharge $11.00 and now I'm break even, but the surcharge is more than the cost to the business, so I am not compliant with ACCC