Webinar & Q&A: Recurring invoices & payment authorization

We recently hosted a webinar on how recurring invoices with payment authorization work in TaxDome. More than 400 people joined us live, and asked us over 200 questions! If you missed the live event, don’t worry: you can watch the recording below. We have also transcribed the answers to your questions in this blog article.

Here’s a brief overview of the topics we covered

• How to set up recurring invoices with payment authorization
• Choose how to get paid: set up the payment methods available to your clients
• Overview of the client experience
• Future integration with Proposals [coming soon]

And here are some of the questions you asked and we answered live:

• How to make one-time changes or update recurring invoices
• Client and firm notifications related to recurring invoices
• Future plans for recurring invoices

Want to learn more about recurring invoices? Schedule a demo with our implementation team:

Got an idea for an addition that would improve recurring invoices — or any other feature of ours? Drop us a line using the Feature Request Board

Q&A Transcript

Can we offer recurring invoices on a weekly, bi-weekly and quarterly basis? Or is it just monthly?

You can set up any schedule that works for you. All the options you listed work, but you can also create a completely customized schedule!

When will the payment authorization be available through CPACharge?

At this time the recurring billing function works only with Stripe. If you utilize CPACharge, you can still use it for recurring invoices and payments, but you will not be able to rely on payment authorization.

You do not have to disconnect CPACharge in order to connect Stripe – both can be connected simultaneously.

If you’re already using CPACharge and have outstanding invoices, how does switching to Stripe affect this?

You’ll be able to continue seamlessly. After you set Stripe as your default payment provider, you’ll be able to use recurring billing with payment authorization, and at that point you’ll be able to automatically charge your clients.

With payment authorization, your client will have the opportunity to add their payment method (Credit card, bank debit, such as ACH, or both) – depending on the option you selected. The client experience will not suffer and you will be able to receive payments for those outstanding invoices.

Is there a mass default option for auto payment authorization, or do we need to set it up for each client individually?

Every client will need to authorize the automatic payments personally for each recurring invoice. This is something that they will have to do at the start of the process. You just need to remember to choose the automatic payment authorization option when you’re creating a recurring invoice. In the nearest plans, we will create an option to manage payments on behalf of a client, so if you already have a signed authorization and your client’s payment details, you will be able to manage invoice payments for your clients.

Can you send recurring invoices in bulk for the same services?

Recurring invoices cannot be set up for multiple clients at the same time in this release. We recently released bulk invoices creation for individual invoices, we may add it for recurring invoices in future, as well – please let us know your use cases in the feature request board. 

Do you have to set the recurring invoice for a certain period of time or can you make it recurring indefinitely, until stopped?

At this time you can set a maximum number of 100 recurrences, see recurrence settings.

Is there an option to auto-renew at the end of the initial recurrence schedule? For example, after 12 months, can this be renewed without the client having to enter payment info again?

Yes, it’s possible. You will need to edit the recurring invoice from 12 recurrences to 24 (or any other amount up to a 100) and payments will continue to flow without the client having to sign a new recurring invoice.

How will recurring invoices integrate with contracts?

Contracts are in the process of being upgraded to become Proposals & Engagement Letters (ELs). Soon existing contracts will become an editable section titled “Engagement Letters”, but you’ll be able to rename it to anything you want.

Additionally, you’ll be able to link one-time or recurring invoices to the signing of the contract. Once your client signs a proposal and provides the payment details, it will be possible to set up the automatic payment of all invoices linked to the proposal.

We’ll post more information in a public announcement, detailing what Proposals will look like and how they will work. The post will appear here. 

Is it possible to set an automation to create a recurring invoice upon signing a contract?

Recurring invoices are set up manually as of now — there is no option to create a recurring invoice automatically. We’re analyzing different use cases to add future improvements, but presumably many automations when creating a recurring invoice will be done after the signing of an engagement letter. With the upcoming release of Proposals (see more info in the question above), this may not be necessary. Of course, we’d love to hear your feedback in the future request board.

Are recurring invoices available as a template so they can be sent automatically as a stage in the pipeline?

Not in the initial release, but we do plan on adding this feature. Regarding automations – see the above question. 

Is it possible to have a recurring invoice with variable amounts? In other words, can I add an item to a recurring invoice that is only an occasional charge?

Recurring invoices, by definition, are going to be for a predefined amount of money for a predetermined list of services that firms render repeatedly. However, you can edit the details of recurring invoices after creating them. This way, you can add one-off services or update individual invoices to reflect the services you want to provide in that iteration. Learn how to edit recurring invoices.

Can a client change their payment method a few months after the initial selection has been made?

Currently, the ability to change the payment method is available to the client if the payment did not go through for some reason. In a future update, we plan to make it possible for the client to change their payment method at any time.

Additionally, there will be an option to add credit card fees to payments in a future update.

Can clients cancel recurring payments through their portal?

No, they can’t, only firm members can do that. If, for some reason, a client needs to cancel recurring payments, they must contact a firm and ask for a cancellation.

If a payment fails, will that be reflected in TaxDome?

Yes, it will be reflected in TaxDome. Each invoice has a respective status. And there is a separate tab where you can see all of your recurring invoices and their statuses. Here’s how to view the invoice status — and where to find the tab.

If a payment fails through Stripe, will the invoice automatically be marked as unpaid so we don’t miss anything?

If the automatic payment did not go through, then the invoice for which the payment has failed will be displayed as “Unpaid” or “Overdue”. Because the invoice has been issued according to the schedule in the recurring invoice, the recurring invoice series will also be marked as “Overdue” to draw your attention. 

Can we transfer an existing payment schedule from another payment processor?

Not at the moment, but the ability for firm members to enter in already agreed upon payment authorization schedules into TaxDome will be coming in future releases. At this time, you would send your client a new authorization agreement through TaxDome. The benefit of this is that since your prior agreement your client’s payment methods may have changed – they will enter the information once and you will not have to touch it if payment authorization is enabled. 

Are any notifications sent out towards the end of the set recurrence time frame? Can you continue the recurring invoices automatically without the client doing anything?

When a recurring invoice is created, it is sent to the client for review and signature – they are notified via email, their portal and push notifications if they have the mobile app installed. There are no notifications at this time alerting of an ending recurring invoice, but that’s an interesting idea, our product team would love to hear your feedback.

To continue a recurring invoice without the client needing to do anything, you can edit a recurring invoice, for example, change the number of recurrences from from 12 to 24 — and the payments will continue to flow. Your clients won’t need to authorize it again.

Is there a difference in my bank fees when using a credit card or bank debit?

Yes – credit card and bank debit fees are different. Please see our payment processing fees article for more details

Since they don’t have to log in to view/pay invoice, can we send invoices to clients who are not set up for access to the portal?

The invoices still have to be sent to clients through the portal, so it is necessary for the client to have access to the portal. But we have already started feature development that will allow clients to pay invoices without logging in – this is expected later in Q2 2023.

We use QBO to track employees time. Will TaxDome have time tracking linked to clients to bill out the time tracked?

Yes, you will be able to link time entries to invoices in the future! Right now you can use time entries independently.

Can you have both recurring invoices and one-off invoices set up for the same account?

Definitely. They are separate invoice types so they don’t interfere with one another.

Can there be multiple recurring invoices for the same client? For example: Tax Prep Invoice, Resolution Invoice, Tax Planning invoice…

Yes, sure. You can create any number of recurring invoices for one client, but the client will have to sign and provide payment details for each one.

If there’s a need to update the payment method for recurring invoices, is it done through TaxDome by the client or do we manually do it for them? If it’s the latter, do we update it on Stripe or TaxDome?

This is done through TaxDome. The ability to change a payment method is available to the client if the payment did not go through for some reason. At this time it is only available in case of a failed payment, but we plan to enable clients to update their payment method at any time (new credit card, new bank account, etc)..

If you already have an invoice created, can you turn it into a recurring one?

No, you’ll need to create this invoice again — this time as recurring.

I have CPA Charge and Stripe connected to TaxDome. How does TaxDome know which one to use?

You can set up your default payment provider on your Settings page.

Can we send recurring invoices without a predetermined payment method? For example, if a client wants to mail in a paper check each month.

If your client sends a physical check once a month, you should create a recurring invoice without payment authorization. Then you can record the manual payment to reconcile the unpaid invoice when it is received. However – a paper check contains two key pieces of information; a bank account number and a routing number. So instead of getting paper checks – your client can provide you those two numbers once, through payment authorization, and save themselves the hassle and postage fees of having to send you a check every month. And your firm is spared the hassle of manual reconciliation, admin work, etc. ACH fees are minimal – for processing ACH direct debit, Stripe charges a 0.8 percent fee capped at $5.00 for standard settlement.

Will there be a feature where the client receives a reminder email that a payment withdrawal is approaching?

Not in this release, but that is planned in future releases. 

Is it possible to permit credit card payments only for invoices below a certain threshold amount and require bank payments for all others?

Sure – it’s up to you which payment method you wish to accept. So for example, if you have two clients: one of them you charge $100 a month for minor reconciliation; and another you charge $2500 a month for CAS accounting. In the former, you can allow them to pay you through any payment method – credit card or bank debit, enabling the client to make the choice. And for the premium client, you can indicate that they can only pay via bank debit – they will not be offered the choice to pay via credit card.

The fees for Stripe are higher per transaction than the fees in QBO. If we decide to use TaxDome for recurring invoices, will we be able to automatically add a fee for credit card processing, if credit card payment is selected?

Yes, we plan to add an option that will allow passing on the credit card fees to the client.

Will there be a workaround to allow for partial payment of an invoice by the client or will that be a separate feature as well? 

A recurring payment can only be made in full. However, implementing partial payments for one-time invoices is in plans.

With the ACH payment option, is there a verification process that requires mini deposits in clients’ accounts first?

Stripe has two types of verification: micro deposit – Stripe pays it, and instant verification – which costs $1.5 per verification. Here’s more information on Stripe fees.