Partial Returns - Sales Tax Impact

Jason_Rappaport
New Member
3 0 0

Hi - I'm hoping somebody has some experience with this as I'm hitting a dead end. We are currently on Shopify Plus, TaxJar and Loop Returns. From what I've seen, partial returns are fully refunded to the customer as product and not allocated to taxes. For instance, if a product within an order was $100 (consisting of $90 product and $10 tax) and the order consists of multiple products and that one order is returned and refunded, Shopify refunds $100 and doesn't breakdown that $10 of the refund was sale tax. As a result Tax Jar thinks we owe $10 of sales tax to the state, when in reality we don't. Thus, we'd be overpaying sales tax because partial returns are not reflected. I can't be the only one with this issue. Any tips?!

Replies 4 (4)
Lisa_Knight
New Member
2 0 0

I'm having a somewhat similar problem, maybe. When I refund the shipping on an order, it refunds the sales tax, but then offsets that refund in the returns column.  I'd been including it in sales taxes, to make my invoice balance out, but when I report the sales taxes, it doesn't. Here's an example:Sales tax issue.jpg

umiajhu
Tourist
9 0 17

You're not the only one with this issue, unfortunately. I have the same thing with customers who want to apply a coupon after the fact. If they purchase something for $50, and say that they forgot their coupon, and I refund them 10%/$5, it doesn't return their sales tax to them for that amount. I have posted about this before, and I cannot believe it still hasn't been fixed. You have to manually keep track of these partial refunds outside of Shopify to adjust sales tax. if you've had any luck, please let me know.

Koenvdlist
Tourist
5 0 1

Same problem here! 

akessler
New Member
1 0 0

we just started collecting sales tax in 21 states and will be encountering this a lot.  I talked to support and their is not currently a solution to this problem.   Crazy that there isn't a way to have the system calculate sales tax on a refund.   It will do it if you are refunding a specific product but not if just giving a cash refund.  I thought about creating a discount you can add to the order which has a negative dollar value but i can't make that work either.  Has anyone come up with a workaround?  Shopify - if you are listening, please fix this.