I use the SumUp card machine for card payments; they automatically take their charge before paying the amount into my account. I have that account linked to Quickbooks Self Employed so I can just mark each days payments as business, but do I need to add that charge in as income and then again as an expense or not?
Also, what is the right way to add cash income? Obviously any card payments are automatically logged as my account is linked but am I supposed to ‘add income manually’ or do it as an invoice? Or does it not matter?
Hi there, AllWasPolished!
Since your account is already connected to QuickBooks Self-Employed and your transactions are downloaded, you won't need to manually enter your charges and income. You'll just have to categorise the downloaded ones, and you're good.
If there's anything that I can help, feel free to post back.
I want to start using sum up for card payments but I am struggling to see how your advice is correct. The amount shown as being paid into the linked account is different to the amount invoiced to the customer because Sumup take their percentage before paying you the money! How do you account for the difference in price to show that you paid Sumup 1.69%?
If you do not account for this payment to Sumup then you would be liable to pay income tax on the full amount invoiced to the customer - rather than on the money recieved and the end of year report would not reflect these banking costs.
Please can you advise on how to account for payments taken by a 3rd party card reader.
I agree that answer wasn’t right. Missed the point of my questions completely I think. As I never got a satisfactory answer from anywhere I started doing it all manually just be sure everything was inputted correctly. And I put the Sum Up monthly invoice in rather than adding each individual one so it’s not too much work.
Hello Amy_Lyons and AllWasPolished,
You can use the expense account for the charge (SumUp payment) and record the actual money received as income. Let me guide you through how.
Feel free to read this article for more information: About SA103F Categories.
You might also want to refer to this article for future help: Three tax calculations to help you at tax time.
Please reach out to us anytime if you have additional questions. We're always here to help.
I think you have STILL missed the question,
Example - my Client pays £100 on the SumUp card reader, and 2 days later, - a sum of £95 is credited to my bank, and shows as a SumUp credit in QB for £95.
I cant split this transaction 95 income/5 fee as it would exceed the amount of the banked transaction. And yet I must declare £100 as the invoiced amount for tax purposes.
I dont want to make an invoice as the transaction has already been settled?
I appreciate all the details you’ve provided, TonyDrive.
You can just leave your invoice amount as it is, it won’t really matter. The main purpose of invoices in QBSE is to have something to send to your customer and receive payments from it.
The system would still base the tax calculations from your income and expense (bank transactions). For additional information, please refer to this article: https://quickbooks.intuit.com/learn-support/en-us/help-articles/income-tax-calculation/00/239148
Please continues to post your questions if you need anything else.
Thank you for the prompt reply.
I'm afraid the comment ‘it won’t really matter’ isn’t how the tax man here in the UK works.
if I charged a client £100, then I need to show that £100 as income, AND THEN deduct the fee for the card use, which I can offset as a business expense.
I can’t see how to show this in QB, when the fee has been deducted at source. I’ve still paid that fee, and I need to be able to show it came from a specific client. I can’t just say I got £95 income from the client, as that is fraud
Did you ever get a resolution to this?
I've just started using QB and receive payments through Sumup and am stumped as to what to do.
I'm thinking that i'm gonna have to input all transactions manually (income and Sumup commission).
What did you end up doing?
For a example £100 sale with a £10 fee and £90 paid into the current account
I'd create a control account called "Sumup" make it a bank account.
Bank receipts from sumup say £90 paid into the current account you would allocate as a transfer from the sumup bank account. This would leave a £90 credit balance in the sumup account.
Create a £100 sales invoice to register the sale and mark it as being paid by the Sumup bank account that you have created.
This will leave a £10 debit balance in the sumup bank/control account.
You should then create a £10 expense (or bill) for the £10 sumup charges, and mark this as having been paid by the sumup bank.
This will leave a NIL balance in the sumup control account
You will also have the correct £100 recorded as sales
and a £10 bank charges/seller fees expense.
Hope this helps