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Sales tax after previous deposit collected

Sales tax after previous deposit collected

LarryOSSG
Tourist
3 0 1

I sell custom made musical instruments.  I collect a deposit when the order is placed, and collect the remaining balance when it is completed and ready for delivery.  Let's say the item is $10,000.  I will collect a $2500 deposit initially and the remainder is due prior to delivery, a few months later.  The deposit is not a "physical item" and no sales tax is collected on it.  When I prepare an invoice prior to final delivery, the balance due is $10,000 minus the $2500 deposit = $7500, plus sales tax.  I add the previously collected deposit as a "discount" as there doesn't seem to be anywhere else to add it.  The Shopify invoice will only calculate sales tax on the $7500.  Is there a way for it to calculate sales tax on the full $10,000 amount?   For this example, let's say sales tax is 10%.  The customer should be charged $1000 in sales tax, but Shopify will only add $750.  

 

Another small complaint:  on that invoice, since the previously collected deposit is listed as a "discount", the generated email invoice will say "You saved $2500!" which is not true.  

 

Thanks in advance for any advice!!

Replies 2 (2)
LarryOSSG
Tourist
3 0 1

Thanks so much for taking the time!  I really appreciate your help.  Here is what I don't understand, and maybe you can help me with this.  I already have a "product" called "deposit" which is how I collect the initial deposit - in this hypothetical case $3000.  It is fulfilled when the customer pays the deposit.  If I create another "deposit" for 0$ and apply a $3000 payment to it, then I will have two $3000 payments in the system which will both be included in our gross sales and will affect our accounting and our income taxes.  Maybe I don't completely understand your workaround here.  Is there something that I am not understanding?  Thanks again.

LarryOSSG
Tourist
3 0 1

It seems that the person who offered advice, who I was replying to above, has removed their reply.   They had recommended making a 0$ deposit product, adding it to the invoice, and marking a $3000 payment to it.    Does anyone else have a possible solution?  Thanks in advance.