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View Full Version : Incorporate sales tax or show it separately


jeffslawnservice
04-01-2011, 12:36 PM
I had a few customers bring this to my attention, They suggested that I just incorporate sales tax into my final price rather than showing them the subtotal, sales tax and then the total. I figured if I did incorporate it into my final price I would just round up or down to the nearest doolar, but more than likely just round up. What is everyone else doing? I figured they (clients) would like to see exact costs and that if they saw sales tax then they would know that I was legit not someone doing it illegally, but I was told it might deter people away :confused:

DA Quality Lawn & YS
04-01-2011, 12:50 PM
I would say don't incorporate. Then you have extra work to back out the tax, its your biz, run it the way you want. Customers probably want you to wrap it in as they don't want to pay you with change, to make it easy on them. That don't fly with me...they can just cut a check like everyone else.

WheatBookkeeping
05-18-2011, 07:05 PM
Guys, just as a reminder, have your bookkeeper credit the tax that you collect to the Sales Tax Payable account. Then your sales revenue will be correct and the tax you collect will not be considered part of your income base.

If your customers span across multiple taxing jurisdictions, make sure your bookkeeper knows where the work was accomplished.

TJLANDS
05-18-2011, 08:15 PM
Some states such as NJ you would be breaking the law if you didn't list
the sales tax as a separate line item.
When you apply for a sales tax license they should tell you your
states regulations

JB1
05-18-2011, 08:25 PM
I believe you could really screw yourself if you ever had a sales tax audit.

Roger
05-18-2011, 11:08 PM
I believe PA requires a separate line item for Sales Tax. I would not consider including it into the price. Yes, all my invoices are odd dollars/cents, but never (in 15 years) has anybody complained. I use QB Pro and it does all the work to make it a separate item, and to roll it up at the end of the month for filing. Why make yourself extra work by always having to break it out after you get the payment?