Easy Tech TutsHow to Record Merchant Fees in QuickBooks Online Easily 2026
By Impran M N
Every time a customer pays by card, your processor takes a cut, and that fee needs its own line in your books. This guide explains how to record merchant fees in QuickBooks Online so your revenue and expenses stay clearly separated.
01Set up a merchant fees expense category
Create or confirm you have an expense account dedicated to merchant or processing fees.
02Locate the transaction with the fee
Find the deposit or payment entry where the merchant fee was deducted from the gross amount.
03Split the transaction
Separate the gross payment into the actual sales amount and the merchant fee, assigning the fee to its own category.
04Save and review the entry
Confirm the split is correct and save it so the fee appears properly in your expense reports.
Frequently asked questions
Why shouldn't I just record the net deposit amount?
Recording only the net amount hides how much you're actually paying in fees, which makes it harder to track true income and expenses.
Are merchant fees tax deductible?
Merchant fees are typically a deductible business expense, but confirm with an accountant for your specific situation.
Can I automate merchant fee recording?
Depending on your payment processor's connection to QuickBooks, some fees can be recorded automatically through bank feed rules.
What account type should merchant fees use?
Merchant fees are usually categorized under a bank charges or merchant fees expense account.
Watch the full walkthrough
The same steps, demonstrated on screen from start to finish.
