When making a purchase, a customer typically pays for more than the cost of the good or service – they may also be charged service fees and sales tax as part of their transaction.
Service fees are small fees leveraged by the seller. They are intended to cover the cost of doing business.
Sales tax is a fee charged by your local and/or state governments (in the United States).
In a typical transaction in Ivy Pay, your guests may pay for both a service fee and sales tax. Let's look at each a bit closer.
Service fees are small charges added by the business to the subtotal of a purchase.
When creating a new payment request in Ivy Pay, the service fee is displayed in the bottom right-hand side of the screen:
The service fee displayed on this screen is the sum of three separate service fees:
- Service fees charged by the property (optional)
- Service fees charged by Go Moment
- Service fees charged by Stripe, our payment processor
Please note that service fees charged by Go Moment or Stripe cannot be changed. If you have any questions or concerns regarding these fees, please reach out to your Customer Success Manager for assistance.
If you would like to add a service fee, you can do so in the Setup Wizard.
First, navigate to the Ivy Pay section of the Setup Wizard, then select the Settings section. At the top of the page, you should see the following fields:
There are two Service Fee fields, which can be enabled or disabled independently from each other. You may also turn both on at the same time. Make use of the Active toggle to the right to turn these one or off.
The first field allows you to create a flat rate service fee. For example, if you type "$4" into this box and activate it, you will add a $4 surcharge to any purchases made through Ivy Pay. This extra money will go straight into your pocket.
The second field allows you to create a percentage-based service fee. This is useful because it allows the service fee to fluctuate based on the size of the order.
If you enable both the percentage and flat rate service fees, they will sum together. This allows you to create a "floor" using the flat rate, while also fluctuating the service fee based on the total.
For example, let's say you set the flat rate to $4 and the percentage rate to 3%.
If the guest's subtotal is $100, they will be charged $107:
Subtotal ($100) + Flate rate ($4) + Percentage rate ($3, which is 3% of the subtotal)
On a $20 subtotal, the guest will be charged $24.60
Subtotal ($20) + Flat rate ($4) + Percentage rate ($0.60, which is 3% of the subtotal)
If you have any questions about these calculations or the best way to set your service fees, please don't hesitate to reach out!
Important note: Some properties are subject to taxes on service fees. If that applies to you, please reach out to your Customer Success Manager for assistance.
Sales tax is a small fee charged by your local and/or state governments on each transaction. The amount of the tax can vary wildly depending on your location — some states charge as much as 10% of the subtotal, while others don't assess a sales tax at all.
In Ivy Pay, all of your pre-set items will already have the sales tax built-in, which is an important part of the initial setup process. You can see the tax on the righthand side of the Payment Request modal:
However, Ivy Pay also allows you to create new items using the "Other" option. In this case, you are free to change the Sales Tax to whatever value you wish:
Please note that sales taxes are always expressed as a percentage. If you type "10" into the Tax field while creating a payment request, this translates to 10% of the subtotal, not $10.
If you'd like to change the default value of the sales tax for the "Other" option, please navigate to the Ivy Pay section of the Setup Wizard, then select the Settings subsection. You should then have access to the "Sales Tax" field:
We highly recommend setting a default sales tax that matches the local ordinances in your area. The government takes taxes very seriously, and underpaying your taxes is likely to create trouble for your property.