{"id":7038837,"date":"2026-08-16T05:28:58","date_gmt":"2026-08-16T05:28:58","guid":{"rendered":"https:\/\/peraltafinancing.com\/accounting\/the-ability-to-surcharge-is-going-heres-what-it-could-mean-for-your-bottom-line-and-how-xero-is-helping\/"},"modified":"2026-08-16T05:28:58","modified_gmt":"2026-08-16T05:28:58","slug":"the-ability-to-surcharge-is-going-heres-what-it-could-mean-for-your-bottom-line-and-how-xero-is-helping","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=7038837","title":{"rendered":"The ability to surcharge is going. Here’s what it could mean for your bottom line, and how Xero is helping"},"content":{"rendered":"


\n<\/p>\n

\n

What\u2019s changing<\/strong><\/h2>\n

From 1 October 2026, Australian businesses will no longer be able to add a surcharge to eftpos, Visa, Amex or Mastercard payments. It\u2019s a Reserve Bank of Australia reform, and it\u2019s being enforced through the card networks themselves, so from that date the option to add a fee at checkout simply won\u2019t be there anymore for those card types.<\/p>\n

If you\u2019re one of the many Australian businesses currently passing on some or all of the card fee to your customer, this increases the cost of each sale. The good news is you\u2019ve got time to plan for it properly.<\/p>\n

What this means for your Xero organisation<\/strong><\/h2>\n

If you use Xero to send invoices with a card surcharge applied, this will stop automatically on 1 October \u2013 you don\u2019t need to do anything. Card payments keep working as normal, your customers just won\u2019t be charged the processing fee on top and it will disappear from the invoice.<\/p>\n

If you have unpaid invoices already out with a surcharge on them, those will be updated too. When your customer pays on or after 1 October, they\u2019ll pay the invoice amount without the fee added.<\/p>\n

The option to pass on processing fees will also disappear from your Online payments settings entirely. If you\u2019d prefer to stop surcharging before the deadline, you can turn it off yourself anytime.<\/p>\n

\"\"<\/figure>\n

Considerations<\/strong><\/h2>\n

For many small businesses, the ability to pass on card fees is not just about covering costs, but is a part of a larger set of decisions on what payment methods to offer. Things like how you price, what payment methods your customers expect, and how that impacts when you get paid. This flows on to admin, time you spend chasing payments, and reconciliation.\u00a0<\/p>\n

There isn\u2019t a single right answer \u2013 it will depend on your margins, your customers and how you compete. Here are some paths worth thinking through before October.<\/p>\n

Build the cost into your price<\/strong><\/h3>\n

Work the fee into your list price or hourly rate rather than adding it at checkout. This is simple for your customers to understand, though for some price rises might not be competitively viable. Another thing to consider: not every customer needs the same response. Some businesses choose to absorb the cost for regular, reliable clients and price differently for one-off or higher-risk work.\u00a0<\/p>\n

The RBA has been clear that this isn\u2019t just a naming exercise. A \u201ccash discount\u201d or \u201ccard handling fee\u201d that happens to land exactly where the old surcharge did is the kind of workaround the ban is specifically designed to catch. Whatever path you choose, make sure it\u2019s a genuine pricing decision.<\/p>\n

Absorb it as a cost of doing business<\/strong><\/h3>\n

For some businesses, the fee is small next to what faster payment already saves in reduced chasing and admin time. Getting paid in two days by card, instead of chasing an invoice for three weeks, has a real value in admin time and in your own cash flow. It\u2019s worth looking at the total cost of getting paid, not just the processing fee in isolation.<\/p>\n

Offer a broader range of lower cost payment methods\u00a0<\/strong><\/h3>\n

The more ways you give customers to pay, the more you can shift the overall mix toward lower cost methods. Direct debit and PayTo, for example, typically carry a lower processing fee than card payments and settle quickly \u2013 so you\u2019re not trading speed for cost savings. We know that choice matters to your customers, in fact 86% of consumers say they would rather pay by card.* If they can pay however it suits them they are more likely to pay on time.\u00a0<\/p>\n

Finally, your accountant or bookkeeper is the right person to help you think through a pricing or cash flow change like this, since they know your numbers better than anyone. Consider setting up a\u00a0 conversation with your trusted advisor before October, as you plan.<\/p>\n

*Survey conducted by Xero of 6,021 consumers and 2,547 small businesses globally using Xero, May 2024<\/p>\n

\n

Was this article helpful?<\/p>\n

Yes<\/span>No<\/span><\/p>\n<\/div>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"

What\u2019s changing From 1 October 2026, Australian businesses will no longer be able to add a surcharge to eftpos, Visa, Amex or Mastercard payments. 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