Creating an invoice with a tax deduction
Fanlike
Member Posts: 13
There is a thread discussing a similar case, not sure what I need is also not available in Wave. I'm paid from foreign costumers for consulting service and the tax law of my country allow the exemption of the otherwise 7% VAT taxes. As far as I know there is no way to chose the relevant tax in the invoice page and then add a line that subtract it. My workaround so far has been the creation of a tax called "VAT 7% EXEMPT" whose rate was 0%. But the outline I get is not entirely correct, since you can see a contradictory information about the tax rate, both 7% and 0%. Any suggestion on how to do it properly? It seems to me that a simple change to a minus (-) sign in the tax algorithm would be enough. In this case I would just create a -7% tax and use both in the invoice.
Comments
@Fanlike As of right now, creating a negative tax item is not something that's currently possible in Wave (although, this could potentially be added in the future, we still don't have any immediate plans). In terms of adding the 0% tax on your invoice instead of 7% -- what sort of difference does that make rather than adding -7% tax? Just want to get a stronger idea of what exactly you are trying to accomplish here.
Hi @JamieD thanks for quick reply. It is just a matter of invoice outline. I need to show that the amount of the tax I should pay is deducted instead, not really "0". If I issue an invoice of 100$, I need to show that I should pay 7$ of deductible taxes. The end result is still "100", but if I just select 0% as tax rate you can't see how much you have deducted, neither the supposed VAT tax rate. That's why ideally, I need to create both a positive and a negative tax item. However, yesterday after writing the post I found out another acceptable workaround. I insert an item on sale called "7% VAT tax", I calculate the amount and write it as if it was the product price, then I select "0" as a quantity. In this way my invoice looks like it should. I can see the amount that is deducted, the tax rate, however the amount is not calculated in the final price. In any case, I still think the other option would be even better. Hope I made myself clear. Cheers
Hi @Fanlike . Great idea on the workaround! I'll remember this so I can pass along the knowledge to other users. Thanks for sharing.