Custom fees are a helpful way to improve your bottom line. The fees are allowable as a recovery mechanism for costs associated with doing business, but there are some compliance items to keep in mind. The fees need to be easily referenced and explained in your terms and conditions and/or tariff. Some examples are companies providing their own fiber that are subject to property tax for equipment locations. This expense can be passed through to the client base to help recover those costs. A regulatory cost recovery fee can be placed on the invoice as a way to recover the costs associated with compliance and billing. (It’s always a good idea to consult with a telecom attorney or compliance partner to ensure your language is complaint.) Sample wording for your T&C could be something similar to this:
“The Regulatory Cost Recovery Fee is intended to offset certain costs we incur in providing your phone service. These costs include supporting services such as the North American Numbering Plan Fee, Local Number Portability Fee, Interstate Telecommunications Service Providers Fee, providing disability access, compliance/billing costs and certain state and local sales, use, and telephone taxes.”
Another factor in providing compliant invoices is to ensure that the language on the bill doesn’t include or allude to any of the subscriber’s charges for these fees as being a “tax.” Since they are not taxes, they will need to be placed on the invoice under a separate heading in the bill summary, and not included with the tax portion of the subscriber’s invoice.
Customers with tax-exempt status are still responsible for service fees. If you find it necessary to waive the custom fee for a subscriber, IntegriBill will permit it – but not without requiring the provider to fill out an authorization within the program acknowledging their authority to do so.
Communications providers who have clear and consistent invoice messaging will field less customer service calls questioning the bill. Accurate reporting for custom fees (going back seven years) will also be helpful in case of an audit. Sandy Beaches Software is a proven and effective billing partner when it comes to providing compliant invoices to subscribers. For more information contact SBS today or schedule time for a call here.
