Sales Tax Not Calculating Correctly

Alisha shared this problem 5 years ago
Solved

I saw this before but thought a change I did with the coupons made the difference, however, I am running into it again. Lead 518427 isn't correctly calculating sales tax. IO it shows the contract is paid in full but when it imports into QB the totals are not correct (which is how I am seeing this now). IO is did not calculate something correctly. Please see the price details of the lead and help me understand what happened. Thanks

Best Answer
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You have a $100 item that is taxed, a $40 delivery charge that is not taxed, and a $25 discount that must be applied evenly across the taxed and non-taxed totals.

Subtotal before discount = $100 + 40 = $140

40/140 = 28.57% of the discount applied towards the non-taxable amount, the rest towards the taxable amount.

100% - 28.57% = 71.43% * $25 = $17.86 of coupon applied to taxable total


$100 - $17.86 = $82.14 * tax rate 8.7% = $7.15 tax


What is QB calculating for this lead? It may be that we need to send the aggregated tax rate to QB instead of the original tax rate.

Comments (7)

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1

You have a $100 item that is taxed, a $40 delivery charge that is not taxed, and a $25 discount that must be applied evenly across the taxed and non-taxed totals.

Subtotal before discount = $100 + 40 = $140

40/140 = 28.57% of the discount applied towards the non-taxable amount, the rest towards the taxable amount.

100% - 28.57% = 71.43% * $25 = $17.86 of coupon applied to taxable total


$100 - $17.86 = $82.14 * tax rate 8.7% = $7.15 tax


What is QB calculating for this lead? It may be that we need to send the aggregated tax rate to QB instead of the original tax rate.

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The discount should not be applied to the delivery. The $25 discount is for a coupon (looking at lead 518427) and the coupon is not set to give a discount on the overall order but only the rental item. Maybe I have this particular coupon set up wrong. I have used it about 5 times. I don't know how to go back to see how the other leads generated with this particular coupon.


QB is calculating sales tax at $6.53 which is what I show it should be.

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Unfortunately our promotions are not that advanced. If there is a promotion or discount on the lead, it is applied proportionally to both the taxable and non-taxable amounts.


You'll either have to manually correct this in in QB, or lower the amount of the rental item in InflatableOffice instead of having it on the discount line.

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Out of curiosity, is it the way the promotion is set up? I have other % off coupons that are not affected whereas this particular coupon is % off certain inflatables. I also have $ off coupons that do not seem to have any problems with QB's calculations.

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No, all the promotions are handled the same. Those other events probably didn't have a delivery charge.

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Okay, so pretty much every lead that has a delivery fee and I'm using a coupon/promotion, I'm going to have this, correct?

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Correct