Hi all,
I just paid my quarterly sales and use taxes and as usual had to double check my Square reports to make sure everything was accurate. After fixing a few anomalies (my fault for not setting things up properly), I noticed that the numbers square was calculating for my taxes due were incorrect. Allow me to explain, I include a 7.25% tax rate in the price of my items, so if I sell an item at $100 the actual price should be $92.75 and the taxes $7.25. But that is not what square is calculating. For example, I sold 4 items at $40 (tax included) so $160 total; the actual price without tax should be $160/1.0725 = $149.18 and the tax should be $10.82. Square calculated the price to be $149.20 and the tax $10.80, which is actually less than 7.24% which is not the correct tax rate (and yes I did double check that it was set to 7.25%). I know this is only $0.02 difference, but when you have enough sales these discrepancies add up significantly. Is anyone else experiencing tax calculation issues? And any idea why this is happening? If this is a common issue I wonder how many Square users are underpaying on taxes.
