Processing fees

How do you record Square or PayPal fees in your books?

Payment processors deduct fees before funds reach your bank account.

How vendors usually record this

  • Record total sales as income.
  • Record processing fees as a separate expense.
  • Ensure deposits equal income minus fees.

Why separating fees matters

It:

  • Keeps income accurate.
  • Makes fees visible over time.
  • Helps compare cash vs card profitability.
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Related resources

How do you keep track of cash sales? Do you just use a spreadsheet or pen-and-paper, or invest in an accounting app?

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