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Processing charges (also called surcharges or handling fees) are additional fees you can add to a customer’s payment to recover card processing costs or cover administrative handling. When enabled, the fee appears as a clearly labeled line item at checkout so customers see exactly what they are paying before they confirm payment.
Surcharging credit card transactions is regulated in some US states and in certain international jurisdictions. Before enabling processing charges, consult your legal or compliance advisor to verify that surcharging is permitted in the states and countries where you do business.

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When to use processing charges

Processing charges are appropriate when you want to:
  • Offset Stripe/PayPal processing fees — recover the cost of card acceptance (typically 2.9% + $0.30 per transaction) by passing it to the customer
  • Add a handling or administrative fee — charge a flat or percentage fee for processing orders or invoices
  • Maintain price transparency — display the fee separately so customers understand the full cost breakdown rather than building it into the product price

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Setting up a global processing charge

The global processing charge configuration applies to all checkout channels you select — order forms, invoices, and payment links — across your entire account.
1

Open payment settings

Go to Payments → Payment Settings and navigate to the Miscellaneous Charges section.
2

Enable the processing charge

Toggle on Enable passing processing charges to customers. Additional configuration fields will appear.
3

Enter the fee name

Type the name that will appear on the customer’s checkout page and invoice — for example:
  • “Processing Fee”
  • “Handling Fee”
  • “Card Surcharge”
  • “Administrative Fee”
Choose a name that is clear and accurate to what you are charging.
4

Set the fee type and amount

Choose the fee structure:
Fee typeDescriptionExample
Flat rateA fixed dollar amount added to every transaction$1.50 per transaction
PercentageA percentage of the order or invoice subtotal2.9% of the total
Enter the amount or percentage in the field provided.
To offset a standard Stripe processing fee, set the fee to 2.9% plus a $0.30 flat rate — but note that the HoopAI Platform currently supports either a flat rate or a percentage, not a combination. Choose the one that best approximates your actual processing cost.
5

Select the checkout channels

Choose which checkout surfaces will display the processing charge:
  • Order forms — checkout pages attached to funnel steps
  • Invoices — invoices sent to contacts
  • Payment links — standalone payment pages
You can enable the fee on one, two, or all three channels independently.
6

Save

Click Save. The processing charge will now appear automatically on all new transactions on the selected channels.

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How the fee appears at checkout

When a customer reaches the payment step, the processing charge appears as a separate, clearly labeled line item below the subtotal and above the total: 
Subtotal:          $500.00
Processing Fee:     $14.50  (2.9%)
─────────────────────────────
Total:             $514.50
The customer sees this breakdown before completing payment, giving them full visibility into the fee. This transparent presentation helps with compliance in jurisdictions where surcharge disclosure is required.

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Adding a processing charge to a specific product

In addition to the global account-level configuration, you can enable a processing charge on a specific product in the product catalog.
1

Open the product editor

Go to Payments → Products and open an existing product, or create a new one.
2

Expand additional options

Scroll to the Additional Options section in the product editor.
3

Enable the processing charge for this product

Toggle on the processing charge option. This ensures the fee is applied whenever this specific product is purchased, regardless of the global setting.
4

Save the product

Click Save. The processing charge will now be included whenever this product appears in a checkout.

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How processing charges interact with taxes

The relationship between taxes and processing charges depends on how you have configured your tax settings.
Tax configurationEffect on processing charge
Tax applied to subtotalThe processing charge is included in the taxable base by default
Tax applied per product line itemThe processing charge is excluded from the taxable amount
If you want to exclude the processing charge from tax calculations, configure your taxes to apply per product line item rather than to the total subtotal. This is often the more compliant approach, since in many jurisdictions a service surcharge is not itself subject to sales tax — but you should verify the rules that apply to your situation.

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Using negative line items for discounts

The same line item system that supports processing charges also supports negative-priced line items on invoices. These act as credits or discounts and reduce the invoice total. To add a credit or discount:
  1. In the invoice editor, click + Add more products
  2. Select or create a product with a negative price (e.g., ”-$50.00”)
  3. Label it clearly: “Loyalty Discount”, “Referral Credit”, “Early Payment Discount”, or similar
The negative line item appears on the customer-facing invoice exactly like any other line item, reducing the total accordingly. Example: 
Web Design Services:     $1,200.00
Referral Credit:           -$100.00
Processing Fee:              $31.90  (2.9%)
─────────────────────────────────────
Total:                   $1,131.90

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Refunds and processing charges

When you issue a refund on a transaction that included a processing charge, the behavior depends on how the refund is handled:
  • Full refund through the HoopAI Platform: the processing charge amount is included in the refund — the customer receives back the total they paid including the fee
  • Stripe’s own processing fee: Stripe does not refund the processing fee it charged you (the merchant) for the original transaction. You recover the card processing fee you paid to Stripe, but Stripe itself retains its fee. This is standard across all Stripe-connected platforms.
When issuing a partial refund, the processing charge is typically not refunded proportionally — only the product amount is refunded. Confirm the refund amount shown in the refund dialog before proceeding to ensure it reflects your intent.

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Compliance considerations

This section is informational only and does not constitute legal advice. Always consult a qualified legal or compliance professional for guidance specific to your business.
Processing charge compliance in the United States:
  • Surcharging credit cards is prohibited in some states (check current state laws as they change frequently)
  • Debit card surcharging is prohibited federally under the Dodd-Frank Act
  • Disclosure requirements: most jurisdictions require the surcharge to be clearly disclosed before payment is completed — the HoopAI Platform’s transparent line item display is designed to support this requirement
  • Cap limits: Visa and Mastercard cap credit card surcharges at 3% of the transaction
Outside the US, surcharging rules vary significantly by country. In the European Union, for example, consumer surcharging on cards is prohibited for most consumer transactions.

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Fee calculation examples

The table below shows how different fee configurations affect common transaction amounts:

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Flat rate fee of $1.50

SubtotalProcessing feeCustomer pays
$50.00$1.50$51.50
$200.00$1.50$201.50
$1,000.00$1.50$1,001.50
A flat rate fee favors you on smaller transactions (where it represents a larger proportion of the cost) and is less impactful on larger ones.

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Percentage fee of 2.9%

SubtotalProcessing fee (2.9%)Customer pays
$50.00$1.45$51.45
$200.00$5.80$205.80
$1,000.00$29.00$1,029.00
A percentage fee scales with transaction size, which more accurately mirrors actual card processing costs.
For service businesses charging high-value invoices (over $500), a percentage-based fee typically provides better cost recovery than a flat rate. For businesses processing many small transactions, a flat rate may be more predictable.

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Processing charges on recurring invoices

If you have processing charges enabled on invoices, the fee is added to each invoice generated by a recurring template. Because each generated invoice is treated as an independent invoice, the processing fee is calculated and added fresh for each billing cycle. This means:
  • A monthly retainer client will see the processing fee on every invoice they receive
  • Auto-payment customers will be charged the subtotal plus the processing fee each cycle
  • The processing fee amount may vary slightly month to month if it is percentage-based and the invoice total changes
If you do not want the processing fee applied to a specific recurring invoice, you can disable processing charges on invoices globally and add a processing fee only to the specific products or one-time invoices where you want it.

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Disabling a processing charge

To turn off the processing charge for your account:
  1. Go to Payments → Payment Settings → Miscellaneous Charges
  2. Toggle off Enable passing processing charges to customers
  3. Click Save
The fee will no longer appear on any new transactions. Transactions that have already been processed with the fee are not affected. To disable the fee on a single channel only (for example, remove it from order forms but keep it on invoices), deselect that channel in the Miscellaneous Charges settings without turning off the feature entirely.

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Processing charges on invoices with payment plans

If a customer has a payment plan and you have processing charges enabled on invoices, the fee applies to each installment payment independently. Each time an installment is charged, the processing fee is added to that installment amount. For example, on a 1,000invoicewitha31,000 invoice with a 3% processing fee split into two 500 installments: 
Installment 1 payment:   $500.00 + $15.00 fee = $515.00
Installment 2 payment:   $500.00 + $15.00 fee = $515.00
Total collected:         $1,030.00
The processing fee is calculated on each installment payment, not on the invoice total upfront. Customers with auto-payment enabled on a payment plan will see the fee applied to each auto-charged installment.

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Frequently asked questions

Not currently. One processing charge configuration applies across all payment methods on the channels you have selected. You cannot, for example, charge a fee for credit cards but waive it for ACH bank transfers. If you need method-specific pricing, consider building the difference into your product pricing instead.
The processing fee you charged the customer is included in the refund amount — the customer gets back the full amount they paid, including the fee. However, the fee that Stripe charged you for processing the original transaction is not returned by Stripe. This means you absorb the Stripe processing cost on refunded transactions, which is standard practice across the industry.
Not currently. Processing charges apply to one-time payment checkouts — order forms, invoices, and payment links. Stripe subscriptions use Stripe’s own billing infrastructure and do not support the HoopAI Platform’s miscellaneous charges feature.
Yes. In the Miscellaneous Charges settings, the Fee name field controls exactly what label appears on the customer’s checkout page and invoice. You can use any name that accurately describes the charge — Processing Fee, Handling Fee, Card Surcharge, or anything else.
In the Miscellaneous Charges settings, you can select which checkout channels display the fee. Deselect Order Forms and select only Invoices. The fee will appear on invoices but not on funnel order form checkouts or payment links.
Currently, the HoopAI Platform supports one processing charge configuration per account. You cannot define separate fees for different products, customers, or channels beyond what the global configuration supports. If you need to charge different fees in different scenarios, consider using negative or positive line items on individual invoices to approximate the desired outcome.
This depends on your tax configuration. If taxes are applied to the subtotal, the processing charge is included in the taxable base by default. To exclude it, switch your tax configuration to apply per product line item. Consult your tax advisor to determine the correct treatment for your jurisdiction.
Use a test mode transaction. In Payment Settings, switch to test mode. Create a test invoice or open a test order form, proceed to checkout, and confirm the processing charge line item appears with the correct name and amount before you switch back to live mode.
Not with the Miscellaneous Charges feature — it always displays the fee as a separate, transparent line item. If you prefer to absorb the fee silently, simply build it into your product prices. For example, if your service costs 100andyouwanttorecovera3100 and you want to recover a 3% fee, price the product at 103 and do not enable a separate processing charge.
Last modified on March 5, 2026