The issue boils down to rounding. Some states ask you to report sales tax on a monthly revenue basis, where Cloud has to calculate sales tax on a job-by-job basis. Cloud calculates tax by rounding at the details (product and service) level of the job. The challengers as an owner you can face from this are:
A) We never want to leave an unpaid liability.Â
B) When calculating the tax, you need to charge a client at the moment of completion using the tax rate in relation to that job and its services.Â
C) When charging a client for tax, you can't charge more than two decimals—you must round the tax and add it to the subtotal to charge a valid two decimal amount.Â
D) When adding up the tax over time across clients, you want to know what you charged and collected, which is the sum of the values from each job (which by necessity were rounded).
E) On a job you may have some taxable and some non-taxable items—not likely, but possible. Thus we account for that, but try to minimize any rounding impact within the job. But, at the job level, it must be rounded because that's where we have to add it to the charge collected.
So,by the end of the month, you do indeed have a tax base collected that was calculated by necessity by rounding at the detail levels within the job. There is no way around charging this at the job level.
All of this being said, the decimal rounding issue shouldn't amount to more than a few pennies per month discrepancy in your sales tax/revenue reports and amount collected. If there's a significant difference, then something is off on the product/service level of the job (For instance, a refrigerator clean was added, but the "Taxable" box was left unchecked").
Bottom line, make sure the "Taxable" box is always checked on every job and every product (where sales tax is applicable) and this shouldn't be a major issue for you. If you have any concerns regarding sales tax calculations, please log a case and we can take a look at your specific numbers.
A) We never want to leave an unpaid liability.Â
B) When calculating the tax, you need to charge a client at the moment of completion using the tax rate in relation to that job and its services.Â
C) When charging a client for tax, you can't charge more than two decimals—you must round the tax and add it to the subtotal to charge a valid two decimal amount.Â
D) When adding up the tax over time across clients, you want to know what you charged and collected, which is the sum of the values from each job (which by necessity were rounded).
E) On a job you may have some taxable and some non-taxable items—not likely, but possible. Thus we account for that, but try to minimize any rounding impact within the job. But, at the job level, it must be rounded because that's where we have to add it to the charge collected.
So,by the end of the month, you do indeed have a tax base collected that was calculated by necessity by rounding at the detail levels within the job. There is no way around charging this at the job level.
All of this being said, the decimal rounding issue shouldn't amount to more than a few pennies per month discrepancy in your sales tax/revenue reports and amount collected. If there's a significant difference, then something is off on the product/service level of the job (For instance, a refrigerator clean was added, but the "Taxable" box was left unchecked").
Bottom line, make sure the "Taxable" box is always checked on every job and every product (where sales tax is applicable) and this shouldn't be a major issue for you. If you have any concerns regarding sales tax calculations, please log a case and we can take a look at your specific numbers.
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