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How much to raise prices to cover card fees

If card fees are eating into your margin, the legal fix is to adjust your prices, not to add a card surcharge. This works out the price that leaves you with the same amount after fees.

The law on card surcharges: Since 13 January 2018, regulation 6A of the Consumer Rights (Payment Surcharges) Regulations 2012 stops a business charging a fee for payment by a card that is not a commercial card. Any fee for other payment methods must not exceed the business's own cost of accepting them. Read regulation 6A on legislation.gov.uk (checked 14 October 2026). This is general information, not legal advice.
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Why simply adding the fee isn't quite enough

Card fees are a percentage of the price the customer pays, so if you raise the price, the fee rises too. Adding 1.75% to a £10 price gives £10.175, but 1.75% of £10.175 is about 17.8p, leaving you £9.997. The correct gross-up is price ÷ (1 − fee rate): £10 ÷ 0.9825 = £10.178. On one item the difference is tiny; across a whole price list and a year of sales it adds up, and with a fixed per-sale fee it matters more.

Rounding is your friend here. Most businesses round to a tidy price point (£10.25 rather than £10.18) and let the small extra cover other costs. If raising prices isn't an option, look at the fee itself: the card machine fees calculator may find a provider that's cheaper at your takings, and the break-even calculator shows which sales the fee hits hardest. The same goes for your other fixed costs. If you're a microbusiness (fewer than 10 staff and turnover of no more than £2 million, or low energy use), Ofgem gives you extra protections on energy contracts, explained in micro business energy contracts.

Formula

Price to charge = (amount to keep + fixed fee) ÷ (1 − percentage fee).

Worked example

KeepFeeChargeFee paid
£10.001.75%£10.18£0.18
£3.001.69% + 10p£3.15£0.15
£250.002.5%£256.41£6.41

Illustrative rates. Charges rounded to the nearest penny.

Frequently asked questions

Can I add a fee for paying by card?
Not for ordinary consumer debit or credit cards. Since January 2018 UK law stops businesses charging a fee for payment by a card that isn't a commercial (business) card. Build the cost into your prices instead.
What about business customers paying with a company card?
The ban doesn't cover commercial cards, but any fee must not exceed what accepting that card actually costs you. Check the regulation and take advice if you plan to do this.
Why not just add the fee percentage to my prices?
Because the fee is charged on the higher price too. To keep £100 after a 2% fee you need to charge £100 ÷ 0.98 = £102.04, not £102. The calculator does this for you.
Should I offer a cash discount instead?
Some businesses price for card and offer a discount for cash. Whether that suits you depends on your cash-handling costs and customers. Make sure your price displays are clear and accurate.

Sources and last checked

Last reviewed 14 October 2026 by Oliver Burton. Editorial policy.