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Credit Customer for Sales Tax?
12-05-2018, 03:49 AM
Post: #1
Credit Customer for Sales Tax?
We just received payment from a customer who is tax exempt. The invoice was created and printed with sales tax applied. Payment in the form of a check minus sales tax has been received.

Also... This is the second invoice and the customer would like sales tax refunded for the first invoice. Obviously they are supplying tax exemption documentation to us for record.

What is the best method/process in webERP to make all this right?

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12-05-2018, 04:12 AM
Post: #2
RE: Credit Customer for Sales Tax?
Credit the whole of the original invoice and then create a new invoice with the correct tax.

There are other ways but as an accountant I think this is the clearest way of going it.

Tim
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12-05-2018, 04:20 AM (This post was last modified: 12-05-2018 04:33 AM by VortecCPI.)
Post: #3
RE: Credit Customer for Sales Tax?
Ah... Very interesting idea. What about the fact we have released an invoice with a number to our customer and he has paid against that number? If we credit the entire invoice and then create a new one will we have a number reference discrepancy?

I was thinking discount during receipt and then GL entry to move from discount to sales tax or perhaps additional GL entry during receipt?

Seems to me your idea is the cleanest solution...
What about the first existing invoice that has been paid? Would we credit that as well and make another?

I am just a little worried about number references...
For first existing payed invoice can I receive -SalesTax and then +SalesTax to GL account on the receive payment page?

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12-05-2018, 04:34 AM
Post: #4
RE: Credit Customer for Sales Tax?
I wouldn't have thought there would be an issue. The allocation would be over all 4 transactions (1st invoice, credit, 2nd invoice and payment ) so the payment would still be linked to the original invoice via the allocation.

Unless there are specific problems with your tax authorities I can't see there being an issue.

Tim
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12-05-2018, 05:48 AM (This post was last modified: 12-05-2018 05:48 AM by VortecCPI.)
Post: #5
RE: Credit Customer for Sales Tax?
Great... Thank you. I was concerned about the invoices already in the hands of the customer. I was taught once it gets into the customer's hand you never change it and you better be able to reproduce it. I will snapshot the DB and give it a try to see what it all looks like.

So now how do we write a check back to the customer for the first tax payment? Is that a GL Bank Account Payment entry? Will it show in customer transactions?
Sorry about al the questions.... I just want it to be done right!

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12-05-2018, 05:51 AM
Post: #6
RE: Credit Customer for Sales Tax?
You enter it as a negative receipt against that customer and everything should allocate off.
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12-05-2018, 07:21 AM
Post: #7
RE: Credit Customer for Sales Tax?
Thank you so much for all your help on this Tim.

As usual it is always less work than I expect!

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12-05-2018, 09:18 AM
Post: #8
RE: Credit Customer for Sales Tax?
Happy to help Smile
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