Fees on a gift card are charged once, when a guest buys it. Sales tax is added later, on the order the card is used for.
What a guest pays for a gift card
The Owner fee on a gift card is split between you and the guest the same way as on your online orders, based on your plan. See How much is the Owner fee for orders? No sales tax is added.
The guest never pays the card processing fee on a gift card, even if they pay it on your orders. You cover it.
You receive the gift card amount, minus the processing fee and your share of the Owner fee, if your plan gives you one. See When you get paid for gift card sales.
When fees are charged
This table shows when the Owner fee, the processing fee, and sales tax apply.
Event | Owner fee | Processing fee | Sales tax |
Guest buys a gift card | Yes | Yes, on card payments | No |
Guest uses a gift card on an order | No | No | Yes, on the order |
Rest of the order paid by card | Yes | Yes | Yes |
ℹ️ Note: Because fees are charged once, gift card money is never charged twice.
Physical gift cards sold on your POS
When you sell or reload a physical gift card for cash on your POS, only the Owner fee applies. There's no processing fee. If the guest pays by card, on the reader or with Card entry, the processing fee applies.
Sales tax on an order paid by gift card
A gift card is a way to pay, not a discount. So the Owner fee is charged only on what the guest pays out of pocket, but sales tax is on the full order.
Example: The order subtotal is $38. The guest uses a $20 gift card and pays $18 out of pocket. In this example, the guest's share of the Owner fee is 5% and the sales tax rate is 9.5%.
Owner fee: charged on the $18 the guest pays, so $0.90. It's not charged on the full $38.
Sales tax: charged on the full $38 subtotal, so $3.61. The gift card doesn't reduce the tax.
The gift card can also cover the tax and any remaining balance.
ℹ️ Note: Coupons and reward points work the same way for the Owner fee, which is charged only on what the guest pays. For sales tax, they're discounts, so sales tax is on the amount after the discount.