Need to update transaction with taxes
CMA_Akta_Kariya
Member Posts: 8
My client posted couple of transactions on his own and forgot to add taxes. those transactions are not editable. Can anyone help how to account for taxes now?
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Hey @CMA_Akta_Kariya! Great question here. If your client has added these transactions manually, then they should still be able to edit them! Definitely strange that these are greyed out. Is this a screenshot from within your account of this transaction, or is this from their own account? This might come down to a permissions issue on your collaborative account.
Hi Connor, Thanks for the response. This screenshot is from my account. But the client is facing the same issue as he also asked why those transactions are uneditable.
The issue is that the client entered stripe payment and stripe charges (My client is not an accountant so he doesn't know much about accounting). But after he downloaded stripe statement which he didn't refer earlier, he realized there is the tax on stripe charges. When he tried to rectify the transaction, he was not able to do it.
Hey @CMA_Akta_Kariya
Wave doesn't automatically account for taxes in Stripe's fees. Since you're in a region where Stripe charges tax on the processing fee, you'll need to add this manually using a Journal Transaction. To open this function, click on More > Add journal transaction in the upper right-hand corner of the Transactions page.
If the tax you're recording is recoverable, the Journal Transaction should look like this:
Dr Sales Tax Paid Account for the amount of the tax
Cr Payments by Wave clearing account for the amount of the tax
If the tax is not recoverable, the Journal Transaction should look like this:
Dr Merchant/Stripe Fee Account for the amount of the tax
Cr Payments by Wave clearing account for the amount of the tax
Then, if you have your bank account set to automatically import to Wave, make sure to categorize the incoming deposit as a transfer from the Payments by Wave account.
One last thing to note - if the tax you're paying is recoverable, make sure to add this detail to the notes of the Journal Transaction for your records. You'll also want to use the account transactions report for this Sales Tax, found by going to Reports > Account Transactions report, when filing. Because this tax has been entered manually using a Journal Transaction, it won't appear on the Sales Tax report as other transactions do.
I hope this helps to guide you, and clarifies how to keep track of tax on fees for your Wave account.