Incorrect sales tax calculation

[nattivillin]

Maybe we are doing something wrong but when we put in a sales tax in the amount of 6.5% CommitCRM calculated the tax as .97 for $199 worth of charges.

Now I have to call and tell the customer we "Calculated incorrectly"

What am i missing?

[lpopejoy]

Do you have your sales tax rates assigned at the account AND the item level? Same sales tax rates assigned both places?

[nattivillin]

I think it is only at the account level. We don't have varying rates by item here.

[lpopejoy]

If I'm not mistaken, even if you have sales tax rates assigned on the account level, you also have to have the rates assigned at the item level as well.

[nattivillin]

So you have to assign a tax rate per item?

[lpopejoy]

Here's the info from the wiki here

In order for a tax to apply to a Charge, the following should be set:

Define taxes for the Item (Tax1, Tax2, Tax3 in the Item details window)
Define taxes for the Account (Tax1, Tax2 in the Account Details tab)

Taxes will be calculated when there is a match between the tax type of the Item and the Account which were selected for the Charge record

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This makes absolutely no sense to me, but this IS the way it works. Maybe if enough people complain it will get changed. What this results in is that there is NO way to have more than three tax rates - because that's the # of tax fields on an item. If have to charge different tax rates for different geographical areas/account types, just hope you don't have more than three - or else you will have to create a different item for each sales tax rate...

[AN-Tech]

I had issue with this as well and Luke is correct. You have to define the tax on the item as well as the account. So for us each of the items gets assigned 3 different rates. Which can be difficult since we occassionaly have a 4th rate that must be used. Then the account gets assigned a rate as well, for us its a single rate, not sure why you might need two.

I don't really understand the reasoning behind this and mentioned it to them when I first started out. All it really needs is a check box for taxable or not taxable at the item level, then apply a rate at the account level. This would make things much simpler and allow many different rates to be used.

[lpopejoy]

Yeah, ascendnet is right on... There is no reason that I can think of to assign sales tax rates at an item level... And even if there is a good reason, I dont believe this is supported in Quickbooks anyway. All that is needed is a taxable "checkbox" at an item level, and then the ability to assign any number of tax rates to an account - or to create tax groups and assign a single tax "group" to an account.

Commit, I hope you can see how badly this needs fixed. I know you said in an previous email that you've never heard of anyone having a problem with this, but it's obvious from this thread there at least three people... And who knows how many more that havent been heard from... Then there's all the future users that will be frustrated by this...

For now, we are stuck manually "fixing" this in Quickbooks.