How to refund tax after the sale?

[donnat44]

2 questions

How do I go back and refund sales tax?

Why did Square charge two sales tax entries from two different locations?  Only one was enabled in settings.  Could it be specific to an item?  The Square was charging multiple tax locations on some but not all transactions.

[Helen · Accepted solution]

@mike109 You're right, if the reason you're processing a partial refund is to refund sales tax, the tax section of your Sales Report won't reflect that the entire sales tax has been refunded - and there isn't a way to categorize the refund at this time.

For that reason in these cases, it might be worth refunding the entire payment and accepting the card payment again for the updated amount. Thisi a good call out, thank you! 

[Frida · Accepted solution]

Hello @GoldieFalafel,

We see its your first post in the Seller Community, welcome!

Currently this is not a an ability at this time. While there is an ability to initiate a partial refund on the Square point of Sale app, there isn't a way for the partial refund to reflect this was just for taxes in reporting. 

@Helen's current workaround above is still accurate. Any new updates made to this will be updated through this thread.

I look forward to hearing your thoughts!

[Helen]

@donnat44 You can issue a partial refund for the sales tax from the Point of Sale app:

1. Navigate to the Transactions section.
2. Tap on the payment in question > Issue Refund.
3. Tap Amount a the top of the screen to refund a specific dollar amount. 
4. Enter the amount of the sales tax that you want to refund.
5. Tap Next.
6. Select a reason for the refund and then tap Refund.

It does sound like you have two taxes enabled for some items. You can review your items and the taxes that are applied to each one from the Items section of your online Square Dashboard.

This Community post shows how to quickly apply taxes to items from your Dashboard too. I hope it helps you review your current library! 

[mike109]

Hi @Helen. When doing a manual amount refund in order to refund sales tax on a transaction, is there a way to categorize the refund amount as sales tax so on the monthly reporting the Tax line item reflects the refunded amount? Otherwise the original sales tax will still show in the monthly report for sales tax, and the refund will show in the 'Returns' line item.

[Helen · Accepted solution]

@mike109 You're right, if the reason you're processing a partial refund is to refund sales tax, the tax section of your Sales Report won't reflect that the entire sales tax has been refunded - and there isn't a way to categorize the refund at this time.

For that reason in these cases, it might be worth refunding the entire payment and accepting the card payment again for the updated amount. Thisi a good call out, thank you! 

[mike109]

Hi @Helen. I just wanted to check if there is any possible solution for this in the works? We are still running into this issue, and having to refund the entire transaction and re-collect payment. Thanks!

[JustinC]

Stepping in for Helen! No recent updates as of yet. 

Sorry about that. @mike109

[GoldieFalafel]

Any update on this?

[Frida · Accepted solution]

Hello @GoldieFalafel,

We see its your first post in the Seller Community, welcome!

Currently this is not a an ability at this time. While there is an ability to initiate a partial refund on the Square point of Sale app, there isn't a way for the partial refund to reflect this was just for taxes in reporting. 

@Helen's current workaround above is still accurate. Any new updates made to this will be updated through this thread.

I look forward to hearing your thoughts!

[austinpowellart]

We need the option to refund sales tax as soon as possible. Ecommerce is big right now and people need to sell to other states. Please update this thread with more information on this. 

Thanks

[JJ_]

Thank you for taking the time to share your interest in this feature @austinpowellart I recommend you submit a Feature Request here. This will help our product team get visibility and track other Sellers with similar interest in your request. 

Important: When submitting a request, make sure to include the desired feature, and provide the details of how this feature will help your business succeed (how would you use it and what you expect from it).

P.S. Welcome to the Seller Community 

[austinpowellart]

Thanks for this information. Will do.

[PSpencer]

I listed 2 counties that I had shows in.  I didn't realize that I needed to "uncheck" one of the counties and now I charged my customer sales tax for 2 counties thereby doubling the amount of sales tax I collected.  It's the next day now.  I know how to refund a customer but is there a way to indicate that the refund should come out of sales tax only?  Or will I have to manually change my sales tax when I pull the information to submit my monthly taxes?

[ashc]

Hey @PSpencer!
 

It looks like there's some discussion in an existing thread in the Community around refunds and sales tax.

Check out this thread I moved your post to for more details. 

[PizzaCo]

Any updates on this? Now that you have to pay the fee for a reversed transaction it is not feasible to refund a large transaction and run it again causing you to pay the credit card fee twice if the sales tax just needs refunded due to an employee entry error for a tax exempt transaction.

[Candlestore · Accepted solution]

@PizzaCo ;

You can always do a Custom Amount for the transaction, for the reason put in other and then accidental Sales Tax charge or similar.

You can issue a partial refund for the sales tax from the Point of Sale app:

1. Navigate to the Transactions section.
2. Tap on the payment in question > Issue Refund.
3. Tap Amount at the top of the screen to refund a specific dollar amount. 
4. Enter the amount of the sales tax that you want to refund.
5. Tap Next.
6. Select a reason for the refund and then tap Refund.

That should work for you.

[chuck902]

We have the same problem. A tax exempt customer was charged tax for a transaction.

There is no way to refund the tax that shows up properly in the monthly reports.

I see this question was first raised in 2018. Can we get an estimate on when this will be fixed?

[_Violet]

Hi there, @chuck902 - Thanks for following up on this thread.

The Best Answer from @Helen is the most accurate and up-to-date information at the moment. I don't believe we are currently working to change this but I am going to reach out to some of our teams to see what I can find out for you.

I'll reach back out to you here once I gather more info!

[_Violet]

Hi there again, @chuck902 

I’ve shared your feature request with our Product Team, as they are constantly improving our products based on feedback like this. To learn more about how feature requests work, please see this post from one of our Seller Community Moderators. 

In the meantime, keep an eye out for any updates in our Seller Community. We appreciate your input! 🙂