I've been trawling the internet for advice on this, but can't really pin anything down. When I start teaching again, I would like to offer pupils/parents the opportunity to pay direct into my bank account - some have asked for this in the past. Does anyone else allow this? Presumably where it is a BACS payment, you just provide them with the necessary details, and they pay direct (the same way as if they were writing a cheque). Also, what about Direct Debits, so that payments could be debited automatically, say for a year? For example, I pay my ISM membership by Direct Debit - each month, an amount is taken out and it is adjusted annually as fees rise - could you do the same thing say to allow pupils to automatically pay the amount specified at the beginning of each half-term or term?

Thanks!

David

Allowing people to transfer money into your account is easy. I do this all the time (paying not receiving) via internet banking.
Ask your bank how much they would charge for a direct debit facility. I'm betting it is a lot.
Dora

Hi David,

being able to collect a Direct Debit requires authorisation under the Direct Debit scheme. You need to register with BACS, so you will need a bank that literally warrants. It is very often not offered to Small Businesses. You can signal an interest to your bank manager, but you will definitely require a business account for this, and it is very likely that they'll knock you back after they have run their checks.

I looked into it in the past, and I thought: "Nah, what is all this hassle for?"

My students simply pay via standing order, and this works absolutely fine. I have a separate account (not a business one) for this, no problems. They just need your sort code and your account number, that's it ...

They should be able to put a reference in when they set it up via online banking, so you know who it's coming from without having to cross-reference anything.

Some of my students pay by standing order and others occasionally pay by bank transfer (basically a single standing order). It is my preferred payment method but I let my students choose whichever method they prefer. All of my students who pay by standing order have set them up through online banking rather than completing a form. They put their surname down as the customer reference.

Lucid

Have you considered Paypal? Japanese banks are so relentlessly un-international that it's commonly used by translators working for clients in different countries, but it's also used for small personal transactions.

Yes, forgot to say that. Although their references only show on my paper statements, but not on my Online statements. However, I think I am intelligent enough to read a name - I thankfully don't have any students who have the same first and second name

Paypal costs money and is not the safest, one reason to only use it where absolutely necessary (I use it myself, but not for people who have one-to-one lessons).

Speaking as an ex-banker of 35 years, I would not use Paypal.

Standing orders are fine, as are single bank transfers. The beauty of standing orders is that the system remembers to make the payments each week/month/quarter - whatever the instruction is.

For a Standing Order, does the amount have to be the same and the payment on a regular date? If it does, then this might not work so well.

If they are setting up a recurring standing order then there has to be a regular payment amount and the same date per month that the money is taken. I think the very first and final payments in the cycle can be different. However (in online banking) your students should be able to set you up as a payee so that your details are saved, then they can pay you whenever they need to and on whatever date - just by a single bank transfer really but it usually comes under the standing order category.

Lucid

Even with standing orders, you will have to keep on top of everything. Remember that they are easily cancelled. You never know... things could be tight one month, so that will be the first thing that goes out the window for some! Hopefully not many people would be sneaky enough to hope you didn't notice...

coming from a country where cheques literally don't exist anymore and standing orders and bank transfers are the norm, i would say you are worrying too much, David. standing orders and transfers here are the same than in germany, so one cannot say the process here is more complicated, although i noticed that some people seem to think so myself. it's really not complicated and works very well. much more hasslefree than cheques and cash...

Cash is surely easier to hide from the tax man less hassle overall?

Disclaimer: I in no way endorse fiddling of the non-instrumental type

Hi David,

You're not really big enough to warrant direct debit, even if the bank would do it, which I doubt, the charges would be very disproportionate.

I would be quite wary of paypal as well, although it's fine for a one off.

For standing order you really need to agree an amount per month, taking account of 5 week months and school holidays. I believe that there was a lady on here a while back who worked a 45 week year, so worked out the total amount and charged a 12 monthly standing order, she also included an amount for books and sundries so the only other thing they had to provide for was exams and festivals.

If you decide to go ahead, all they need is sort code and account number and some form of reference if you have more than one with the same name etc.

I think that what I shall do is just offer people the opportunity to pay direct into the bank rather than anything else - I think this would be OK for those who don't want to write cheques anymore.

you don't have to set up direct debits..... they can either bacs you or they can set up a standing order... this will cost you nothing and you don't have to do anything..... obviously you will have to check payments have been made etc and give them a receipt....... but you will have to reimburse for hols etc.......obviously flutey

Hi David
My pupils pay half a term in advance. The ones who pay online pay into my account upfront at the beginning of term by online banking and put their child's name as the reference for the payment. Then I ask them to email me the receipt of the transaction and I issue a receipt once the money arrives in my account. Probably easier than doing a standing order or BACS. BACS would require a business account and probably incur a charge. Standing order requires no charge, but obviously takes about 3 - 5 days to clear into your account.

so does a bank transfer. it just clears faster if the person uses the same bank or one with a faster payment scheme.
i always find that timewise, it makes no difference whether someone pays via standing order or normal bank transfer. with the former, they don't have the excuse of forgetting though
my standing orders are all set-up for the 1st, and they are usually in my account by the 3rd.

I issue the invoices a week before the first lesson by email so that they will either turn up with a cheque on the first lesson of the term, or have done an online payment transfer before the starting lesson. I haven't thought about standing orders yet as the number of lessons a term varies, although I suppose I could think about working out a monthly amount that would cover all the lessons, but then it would be a bit tricky if a pupil was away on a certain date and I had to adjust the amount. With adequate notice, I won't charge a student for being away.