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Merchant Account Fees and Sales Taxes
CrispyBacon
Member Posts: 2
I noticed that Wave took their 1% from my last payment, yet when I go to my Sales Tax report, they're still showing that I owe taxes on the FULL amount. Is wave not paying their own Sales tax on the 1% that they take from me? To me, Wave taking 1% of the AFTER tax amount means THEY are responsible for the taxes on that 1%, not me. If Wave doesn't want to pay taxes, they should be taking 1% of the PRE-tax amount.
Anyone else run into this issue?
At the end of the day, I'm paying 1% + tales taxes, for the convenience of my customer paying via EFT. That's a "recoverable" tax, where I live. Why is the bookkeeping not keeping track of this?
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Hey @CrispyBacon , when you send an invoice for $100 (for example) and your customer pays you that money, the entire amount is considered income. If you have a merchant processing the money for you and they therefore take a fee, this is considered an expense for the purpose of processing. With that being said, you owe taxes on the entire amount that is processed and not on just what you receive because it's all income.