DESKTOP EDITION CLOUD EDITION SERVER EDITION GUIDES FORUM

Discounts are showing as purchases on tax summary report


#1

When I create an invoice I like to show a list of services given with a normal price. I then like to show a discount if invoice is paid in a number of days. That is perfect on the invoice, but when I then want to look at tax summary, the discounts show as purchases which is not what I want to show.

Should I show the discount as an expense or should I show the discount as a reduction in the item it refers to, which is what I do. These are service items for e.g. treat for ants $120.00, but if they pay in 7 days they get a $40.00 discount.

At the moment I enter treat for ants in pest control, and then enter discount in the same item, treat for ants and a minus -$40.00 in pest control, but that -$40.00 shows up as a purchase, so I am doing something wrong, can you please help.


#2

When you are adding “Discount” line item, you still need to select an Account for that line item. What account are you selecting?


#3

I am selecting the same account as the invoice item. At first I set up another item called discount and selected the same account as in pest control, but changed it so that the item was the same as in ants and the account was the same, and the account was the same as in pest control but no difference.


#4

Is there any way i can send you a screen shot of the invoice and the tax report


#5

I have my Pest control service in Income
I have created another account in income to show discounts, as in discounts given, and of course they are a negative amount. So when I complete an invoice we have separate services going to Pest Control income, and the last line is Discount given as a negative going to discounts given in Income.

When I do a tax audit everything is perfect, it shows the sales and the discount and the amount of tax payable, and money to bank.

When I do a tax summary it shows the tax code, Net sales which are all of the services with a total before discount and then the amount of tax collected, then total sales. The next column displays Net Purchases which in fact in my case is the discount given, then the tax paid and then Total Purchases.

Is is possible for Net sales to show the total service minus the discount, and the purchases only those items that are an expense. Does your programme sense that a negative income is an Expense?


#6

The last line should have read, does your programme sense that a negative income is a expense or in this case a purchase.


#7

OK, I now understand what is your issue.

Thanks for pointing this one out. Tax Summary report goes by individual general ledger transactions and incorrectly assumes that Discounts given is purchase because it is recorded as debit transaction which are typically purchases.

There is simple solution to this, Tax Summary report will need to take into consideration subsidiary ledger from which transaction is coming from. Then it would know that debit amounts on sales invoices such as Discounts given are to offset sales rather than inflate purchases.

I’ll fix this either today or tomorrow.


#8

As always excellent response.


#9

This has been now fixed in the latest version (14.1.5).


#10

I am using the latest version 14.1.5, but unfortunately the discount is still showing as a purchase in the report as described before.


#11

Can’t reproduce this in the latest version. Please create sample business entity demonstrating this issue, then use the “Backup” button and send the accounting file to support@manager.io


#12

I have sent that to you. I should mention that i use cash basis, and the report before the customer payment was blank, but showed the discount as a purchase when the customer had made the payment.


#13

Did you receive the backup file.


#14

Yes, I confirm it has been fixed on accrual basis and the problem still persists on cash basis. I will update this topic as soon as I fix this.


#15

Thank you very much.
Great programme


#17

Do you think it might be possible to fix this problem I have.


#18

It is fixable but I will need to introduce new tax code or simply use new Discount column on invoices which will prevent this problem from occurring.


#19

I really would appreciate it if you could fix it. Until you can do this and also the individual amounts in tax summary likeable for details I have to still use my MYOB to do my monthly GST returns, which as you can understand is very time consuming.


#21

Try the latest version (14.2.42). It should now handle discounts properly on Tax Summary report even on cash-basis.


#22

Thank you so much, it all just gets better, when do you think you might have time to make sales and purchases clickable to show details, that would complete my problem