Discussion
Am I within my rights to recharge customers for bank charges made by correspondent banks for incoming foreign payments?
The charges are not made by my bank so I assume the bank in the middle is making the charge.
Either that or the customer is making the payment amount and their bank charges equal to the invoice amount so I always get the invoice amount minus any charge they incur.
I can’t tell which is happening from my end. All I know is that the payment amounts hitting my account are always the same amount down on the invoice amount.
P.S. The “customer” is an agent who I am very pi**ed off with and will not be using again so I’m not bothered about the moral aspect. Normally I’d waive any bank charges as a goodwill gesture.
The charges are not made by my bank so I assume the bank in the middle is making the charge.
Either that or the customer is making the payment amount and their bank charges equal to the invoice amount so I always get the invoice amount minus any charge they incur.
I can’t tell which is happening from my end. All I know is that the payment amounts hitting my account are always the same amount down on the invoice amount.
P.S. The “customer” is an agent who I am very pi**ed off with and will not be using again so I’m not bothered about the moral aspect. Normally I’d waive any bank charges as a goodwill gesture.
You can charge your customer what you like - within the terms of any agreed arrangements you may have in place with them.
You could recover the bank charges by merely sending them an additional invoice to cover the cost, although this may not go down too well, especially if they were not expecting any additional bills of this nature. Alternatively, you could merely increase your future sales invoices to take into account any possible future bnank charges you may incurr. It's up to you to decide whether you want to highlight on your sales/fee invoice the element of your bill that relates to bank charge recovery. I would tend towards not bothering to show it myself.
If you are VAT registered, you need to remember that invoices raised by you to recover costs should have the normal standard rate VAT applied - even if the original cost you incurred was VAT exempt (rail fares, air fares and bank charges are usually VAT exempt).
If you customer is overseas you may be able to Zero Rate the invoice for VAT purposes.
You could recover the bank charges by merely sending them an additional invoice to cover the cost, although this may not go down too well, especially if they were not expecting any additional bills of this nature. Alternatively, you could merely increase your future sales invoices to take into account any possible future bnank charges you may incurr. It's up to you to decide whether you want to highlight on your sales/fee invoice the element of your bill that relates to bank charge recovery. I would tend towards not bothering to show it myself.
If you are VAT registered, you need to remember that invoices raised by you to recover costs should have the normal standard rate VAT applied - even if the original cost you incurred was VAT exempt (rail fares, air fares and bank charges are usually VAT exempt).
If you customer is overseas you may be able to Zero Rate the invoice for VAT purposes.
I used to do work with a company in Vienna (corporate types will guess which one) and transactions were easy. I invoiced them in GBP and that is exactly what arrived in my account.
The same is true for credit card (and even PayPal)transactions - the charges are automatically worked into the exchange rate so the buyer pays without really noticing.
Maybe you should look at an account which is more suited for international stuff?
The same is true for credit card (and even PayPal)transactions - the charges are automatically worked into the exchange rate so the buyer pays without really noticing.
Maybe you should look at an account which is more suited for international stuff?
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