Taxable Sales multiplied by Tax Rate in Sales Tax Liability by Tax Item Report is not matching Tax Due column

Users may sometimes expect that when running their Sales Tax Liability by Tax Item Report, their Tax Rate column multiplied by Taxable Sales should match their Tax Collected column amount. However, there are several reasons why the manually calculated amount will differ from the Tax Collected column. The User needs to consider the following:

1. The Tax Rate column shows the current tax rate defined under Setup > Accounting > Tax Codes. Since tax rates vary from time to time (either by manually editing the tax rates on tax codes or importing the latest State Tax Table, etc.), it is very likely that there are taxes collected included in the report using previous tax rates.

To verify, Users can customize the Sales Tax Liability by Tax Item Report to check the tax rate by:

• Navigate to Reports > Sales Tax US> Sales Tax Liability by Tax Item> Customize.
• Go to Edit Columns section.
• Click the Add Formula Field button.
• On the Formula column, set the following: Formula Type = Percent Ratio (x/y)*100, x = Tax Due, y = Taxable Sales.

If the Formula Rate differs with the Tax Rate column, it means that there are taxes collected not using the current tax rate defined in the report. Users can account for these changes by manually limiting the date/period selection in the report.

2. The Taxable Sales column includes Discount/Mark-Up applied where Apply Before Sales Tax = F. For example, a taxable item sold at 100.00 with applied discount of 10.00 will reflect in the Taxable Sales column as 90.00 (100.00-10.00) while the tax collected will still be calculated; against base amount of 100.00.