Payments - Minimum Transaction Charge - Introduced from 01/08/2017
In exchange for providing an online payments service we calculate our fee at a transaction level. In accordance with HMRC guidelines we apply a 20% VAT charge at a transaction level. We are also required by HRMC to apply a minimum VAT per transaction of £0.01.
In an effort to provide absolute clarity to school finance staff (as we know just how difficult it can be to reconcile where rounding up or down to the nearest pence is required) we will be implementing a minimum transaction charge of 5 pence from 1st August 2017. The aim is to deal with situations where small value Payment items (under £5) result in the calculated VAT amounting to a fraction of a pence.
To put this in to perspective, this will only affect transactions which are under the value of £5 and it’s highly unlikely that you will notice the difference in real money terms.
If you have any questions about this change, please contact us on Live Chat.