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Square doesn’t allow me to make “tax included in the price” on a per-item basis. I can either make all items tax-included or all items tax-added.
But I just noticed that, when I create an item, there are two settings under tax.
First, there is a toggle to make the item non-taxable.
And second, there is a checkbox where I can choose to apply the tax or not.
So here’s my question: If I leave the nontaxable toggle turned off, but don’t apply any tax, does that item get counted as a taxable sale? I think this means that the tax won’t be added to the transaction at checkout, but Square will still record this as a taxable sale.
When I review my monthly sales report, I see two categories: taxable sales and nontaxable sales. I assume non taxable sales only includes sales of items specifically marked as non taxable. Correct?
So does that mean that the sale of an item which I did not apply any tax to would still appear as a taxable sale?
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Hi there, @mikesclub 👋
So as far as taxes go, the option to choose which sales tax is to provide options to sellers who may have to tax certain items differently. For example, food versus retail can have different tax rates. So sellers are able to set up various tax rates and choose which one applies to which items.
For the reports, only items marked "non-taxable" will be recorded as non-taxable sales. So yes, the items that are not marked non-taxable or are not given a sales tax will be recorded as taxable sales.
Please note that this guidance is general in nature and does not constitute legal, tax or any other type of professional advice. If you are unsure about your tax or where to find the relevant information, we suggest that you consult with a professional.
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Hi there, @mikesclub 👋
So as far as taxes go, the option to choose which sales tax is to provide options to sellers who may have to tax certain items differently. For example, food versus retail can have different tax rates. So sellers are able to set up various tax rates and choose which one applies to which items.
For the reports, only items marked "non-taxable" will be recorded as non-taxable sales. So yes, the items that are not marked non-taxable or are not given a sales tax will be recorded as taxable sales.
Please note that this guidance is general in nature and does not constitute legal, tax or any other type of professional advice. If you are unsure about your tax or where to find the relevant information, we suggest that you consult with a professional.
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What you can do is if you go to your Square Dashboard > Business and Settings (or something similar) > Sales Taxes
You can have Multiple sales Taxes
and name them Accordingly Meaning
6%, or 6% included in Price.
Then when you Create the Sales Tax you can choose the sales Tax rate and if it is to be calculated from the price or Included in the price.. Then in your example above where it asks to choose the Tax to apply you can choose 6% on that item or the 6% included in the price. Just understand that if you choose the 6% in Price that if you sell something for $1 with a 6% sales tax the item price was probably about .94567 rounded up goes to .95 or .05 cents sales tax.
Where it shows TAX name at the Top --- you can put your own Tax name instead of just Tax.
At the Bottom of this image it has a slider for Tax to be included in or on top of the price.
Owner
Pocono Candle
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That’s a clever way to do it. I never considered that.
question: If I do as I described in my original post (don’t make it nontaxable but also don’t apply any tax), is that different than your suggestion?
for example: a $10 sale with no tax applied, appears in my monthly report as a $10 sale which I will still have to remit out 10% sales tax for, correct?
But if I apply your suggested “tax in price” tax, then my sale appears in the report as a $9 sale which I will have to remit sales tax for, correct?
if this is correct, your method will save me money. Am I right?
I rounded my numbers to keep it simple.
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Theres 2 big differences I see:
1st you need to do the calculation for the taxes backwards to figure out the cost of the item plus the tax to = your total sales price.
2nd, you have no record for yourself or anyone else about your tax you collected.
With the way I suggested for the 1st issue Square gives you the report for taxes collected, no guess work or mistakes on your part. For the second part you can always log in to your square account print out your sales transaxtions and it will show that your item sold for .95cents plus since its a taxable item .05 cents was put aside for taxes of the $1 total sale.
So if you have items that you sell tax free for me food and clothes I have the tax as no tax, tax free or whatever squares wording is.
Then all my others have the tax on top of the sale price.
you can have more than 1 tax aplied to a sale. Square does the tax by the item in the transaction.
So doing it the way I suggest, you have paper trails incase of audit, you have no math mistakes on your part, and you have a Sales tax print out you can just fill in the blanks on your states sales tax forms monthly or quarterly as you need to do.
But it is your deceission as the business owner which you would like to do. I am just pointing out this way to make it easy and have the paper trail. 🙂
Owner
Pocono Candle
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My method should not save you money unless you are calculating your taxes higher then what they should be. My Method will save you time. As we all know in business Time = $$. So the Time savings on calculating taxes owed each tax period will save you $$. I am just not sure why you would not want to use my method of using Squares Tools. These tax settings are a free tool to all Square users. To find the tax owed for your Time period you goto your Square dashboard > Reports > Taxes...
Then you see something like the below image for a time frame you setup.
I then go to my States sales tax webpage, enter these numbers along with my total gross sales for the same time period and then the state tells me how much I owe them. Whivh is very close (within a $1 or $2 ) of what the state calculates I owe them. Usually Square ends up being a little higher for me probably because of rounding calculations.
Owner
Pocono Candle
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