Do you accept Venmo Apple Pay etc?

[Morgan]

Just curious. Do you use Venmo or Venmo business or just add your own sales tax (or no tax).  I work weekly farmers/artisan markets and the majority of it is cash or Venmo and was curious how others use Venmo best for tax time. 

[DirtRoads]

You can accept Apple Pay on Square.    Even some other payments, I think Cash App.    When someone asks we just enter and ppl tap their card or phone and it works.   So far, haven't had anything that didn't work with Square.   I like Square.  Seems price competitive and they charge a straight 2.6%.     No difference on reward or corporate cards.   Those reward cards are really high with some CC businesses.   My business is about 70% CC and 30% cash.   We enter both on square for tax record keeping.  oh yeah Square has 25 cents transaction fee ... on less than a certain amount I think it's 35 cents.

Edited March 9, 2023 by DirtRoads

[Mark C.]

I have a venmo accout but never use it. Venmo is owned by PayPal (I am not a paypay fan) and for now is a cheap Peer to Peer APP although they say it not very secure and really should be only used for friends and family you know. People use venmo for the rock bottom pricing (especially at farmer markets I have found). If you read up on security all apps are not a secure .Something to ponder. My guess is soon payPal will raise fees as that is what they do best.

A more secure app I feel is Square and I have used it nearly since inception in 2010. I like it and used to use my phone  for year or two with it but in past 10 years I use a small iPad  to capture cards. My business is less than30 % CC  sales (last year was 37K in card charges as I'm slowing down in show sales and only had a few shows )

Square jusr bought up Weebly web sevice as well.

Square has worked flawless for me and I recommend it . As noted above by DirtRoads its 25 cents a swipe and low fee flat rate for all types of cards which especially with rewards cards these days matters as they usually are vey high in fees. 

I use the  the chip /tap reader (wireless) with my square  setup. Its been a joy.

[Morgan]

I too use Square chip tap reader and I have nothing but good things to say about it. 

[Callie Beller Diesel]

Because banking in Canada is different enough, I had to look up what exactly the differences between Venmo and any other card service is in the US. (We don’t have Venmo because we do that through our banks instantly, for free, without the middle man, and the encryption legally has to favour the account holder.)

Anyways. It looks like the appeal for Venmo is that customers can use their own cash without having to pay an extra fee, or potentially incur credit card interest. There does not appear to be much of a benefit as a business, because you still have to pay fees to accept payments, and it takes a couple of days to transfer the money to you, just like a credit card. 

So the question then is, will you loose sales at this venue if you don’t offer that payment option? If everyone’s carrying cash anyways and it doesn’t make a difference, it looks like more of a hinderance than a help from my angle. But, if it makes a difference to your sales, you might want to have a look at it. 

If taxes and recording transactions are at issue, you can still use your Square as a till system and enter the venmo transactions as cash. That way you can do things like send receipts, and have the app do your calculations and have a record of the sales tax you have to set aside for remittance. It just helps to have everything in one place.

[Morgan]

The markets I do are fairly "high end" clientele (wealthy tourists) and almost every other person asks if you accept Venmo. The bulk, if not all, produce/fruit vendors are cash only (or Venmo) so most people come in with an expectation that you do not accept cards and act surprised when you do. Venmo transactions are free to some extent, but it depends, which is why I brought it up. Most of these farmers take it and treat is as cash, which will be a massive wake up call eventually come tax time. Shocks me how much money they accept via Venmo without caring about tax implications. I do accept it but use business venmo which is essentially a fee based way and add the proper taxes. The other problem is the buyers too, think, and treat it as cash. From a security standpoint I am not really concerned as I have a QR code they scan and I can confirm receipt right there. 

I guess I am more curious to the amount of people that think and treat it like its cash without a care in the world. Maybe years ago but not now...

[Callie Beller Diesel]

So one of the terms of use of the forum is that especially as a moderator I can’t encourage anyone to do illegal things, and neither can you.  So I’m working from the default assumption that people are using the business Venmo version for their businesses, and that you’re reporting your cash income properly. Setting up Square, or any other payment system, like a till to record all your item sales and taxes makes that math really easy. Combine it with a simple cash flow management system like Mike Michalowicz’s (sp?) Profit First and a bunch of stuff is already done come tax time.

If you’re using the personal version to accept business payments, not keeping business transactions separate from your personal finances or not remitting taxes properly, that’s not good. No one wants a surprise IRS visit, and I think PayPal is going to take a VERY dim view of not getting their fees. I don’t know if they’ve got systems for flagging suspicious numbers of money transfers or not, but it’s not a risk I’d want to take. 

[Morgan]

Oh totally, I report all transactions properly and I didn’t mean to imply it any other way…in fact people are somewhat surprised when they want to pay Venmo and I charge them tax on top and I explain why. I guess I should clarify why I made the topic.

One, to point out how many people I see doing this and that Venmo/PayPal are not stupid and they have adjusted themselves properly and will now send anything over $600 to the IRS (or something small). This is also why they push for you to use their business version to collect transaction fees. Secondly, I guess it was just to see if others see this behavior to the extent I do? All these people are going to have a very rude awakening come tax time or later the way that they use apps like Venmo, so more of a PSA I suppose. And lastly just curious as to all the other payment methods folks use in general. 

[Callie Beller Diesel]

So, it sounds like you’re trying to figure out how to manage customer expectations, and figure out where your policies are in relation to your booth neighbours.

If other vendors are setting the expectation that customers get a discount on venmo transactions, that seems odd, because it’s all electronically recorded even with the personal account option. Most farmers I work with deal with million dollar operations, so they’re subject to RevCan scrutiny and I can’t see it being that different in the US. So it’s probably worth talking some shop with your booth neighbours. Are they in fact giving discounts, or is the sales tax buried in their sticker price? As long as it’s documented and recorded on the receipt properly, that could be a viable possibility, or a workaround for yourself. As long as your area doesn’t have a rule against it, that is. 

If the other vendors aren’t setting an example of cash or Venmo discounts and someone gives you side eye about taxes, this usually means that you’ve got some customer audacity on your hands, and there’s a lot of ways this can be dealt with. If anyone ever needs help with scripting, I’m pretty good at it, and I can walk folks through the principles of how to do it yourself. You can set boundaries and hold them firmly without being rude or harsh.

Personally, I don’t discount the sales tax percent for cash sales. I don’t offer my customers explanations, because that leaves wiggle room for arguments I’m not interested in having. “It’s not my policy to do that,” or “RevCan takes a dim view of that,” is the most they usually get. Your customers aren’t entitled to your financial practices.