Credit Card Bank Fee and VAT/GST?

[Ian Branch 121]

Hi Team,

In some places, not all, the use of a Credit Card to pay by a Customer incurs a 'Bank Fee' on the Seller.

The Seller offsets this by adding an appropriate 'Bank Fee' to the sale.

Question - Where VAT/GST applies, the Sale will incur a VAT/GST as part of the Sell Price.  Does the 'Bank Fee' also incur the VAT/GST?

What is the general experience/knowledge?

 

Regards & TIA,

Ian

[Angus Robertson 527]

My invoices from Worldpay in the UK break down the handling fees into two parts, VAT exempt which includes the percentage transactions charges (up to 4%), and VAT standard rate for fixed transaction costs which include approval and declined fees (4.5p each) and the monthly cost for card facilities.   So no need for end users to be charged tax for bank fees.   These are for VISA and Mastercard.

 

No idea how taxation works in any other country.

 

Angus