Difference between revisions of "Financial Cluster:Sales and Use tax"
From The Bike Kitchen
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Previously, we paid the sales and use tax to the Board of Equalization (BoE) for California, but now it goes to the California Department of Tax and Fee Administration (CDTFA) | Previously, we paid the sales and use tax to the Board of Equalization (BoE) for California, but now it goes to the California Department of Tax and Fee Administration (CDTFA) | ||
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| + | When Sales Tax percentages change, we have to manually change them in Square. All Sales happen in the City and County of San Francisco, so we only need to enter one sales tax number. | ||
We should be collecting Sales Tax for all real goods we sell, including new parts, used parts and Digging Rights (which is essentially a repackage of used parts). We need to calculate our total sales, including things we don't collect and pay taxes on. So we need to include Memberships, Classes, Day Use fees, etc. We do not need to include Donations. | We should be collecting Sales Tax for all real goods we sell, including new parts, used parts and Digging Rights (which is essentially a repackage of used parts). We need to calculate our total sales, including things we don't collect and pay taxes on. So we need to include Memberships, Classes, Day Use fees, etc. We do not need to include Donations. | ||
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* Download a Square "Category Sales" Report in CSV format. We will focus on the Net Sales column which subtracts and returns/refunds for the period. | * Download a Square "Category Sales" Report in CSV format. We will focus on the Net Sales column which subtracts and returns/refunds for the period. | ||
* Remove the Donations Row | * Remove the Donations Row | ||
| − | * Sum up the Sales Tax Collected and enter that into the form as a deduction | + | * Sum up the Sales Tax Collected and enter that into the form as a deduction "Sales tax (if any) included in Gross Sales" |
| − | * Sum up all Net Sales and add Sales Tax Collected. This is our Total Square Sales and will be added to our Class Sales later | + | * Sum up all Net Sales and add in Sales Tax Collected. This is our Total Square Sales and will be added to our Class Sales later |
* Enter the Net Sales for Membership category as a deduction "10(f) Membership: upfront admission fee for 1yr, no other benefits" | * Enter the Net Sales for Membership category as a deduction "10(f) Membership: upfront admission fee for 1yr, no other benefits" | ||
* Sum up the Net Sales for Day Use and Cutting Tools as a deduction "10(f) Fees (all except Membership)" | * Sum up the Net Sales for Day Use and Cutting Tools as a deduction "10(f) Fees (all except Membership)" | ||
* Generate a Paypal Statement for the quarter. Class sales should be already summed up as "Express Checkout Payments" in "Payments Received". Enter this as a deduction "10(f) Educational classes that do not include tangible goods sold". Also, add this to Square Sales and enter this is our Total Gross Sales for the quarter. | * Generate a Paypal Statement for the quarter. Class sales should be already summed up as "Express Checkout Payments" in "Payments Received". Enter this as a deduction "10(f) Educational classes that do not include tangible goods sold". Also, add this to Square Sales and enter this is our Total Gross Sales for the quarter. | ||
| − | * Find all receipts for online purchases such as QBP Tools, QBP Consumables and Amazon orders and sum up all untaxed items. Enter this into the Use Tax | + | * Find all receipts for online purchases such as QBP Tools, QBP Consumables and Amazon orders and sum up all untaxed items. Enter this into the form as "Purchases Subject to Use Tax" |
| − | + | This should be all the information needed to report the sales and use tax. | |
Revision as of 13:28, 3 April 2019
Sales and Use Tax is due every quarter for the Bike Kitchen. We file and pay online. Paypal doess not generate reports for the previous month until after the 2nd of the month, so you will need to wait until the 3rd of the month to complete the taxes for the previous quarter
Previously, we paid the sales and use tax to the Board of Equalization (BoE) for California, but now it goes to the California Department of Tax and Fee Administration (CDTFA)
When Sales Tax percentages change, we have to manually change them in Square. All Sales happen in the City and County of San Francisco, so we only need to enter one sales tax number.
We should be collecting Sales Tax for all real goods we sell, including new parts, used parts and Digging Rights (which is essentially a repackage of used parts). We need to calculate our total sales, including things we don't collect and pay taxes on. So we need to include Memberships, Classes, Day Use fees, etc. We do not need to include Donations.
Use Tax is for items purchased online which we do not resell and do not include sales tax. Mostly this will be QBP Tools and Consumables which we do not resell.
To calculate our Sales and Use Tax:
- Download a Square "Category Sales" Report in CSV format. We will focus on the Net Sales column which subtracts and returns/refunds for the period.
- Remove the Donations Row
- Sum up the Sales Tax Collected and enter that into the form as a deduction "Sales tax (if any) included in Gross Sales"
- Sum up all Net Sales and add in Sales Tax Collected. This is our Total Square Sales and will be added to our Class Sales later
- Enter the Net Sales for Membership category as a deduction "10(f) Membership: upfront admission fee for 1yr, no other benefits"
- Sum up the Net Sales for Day Use and Cutting Tools as a deduction "10(f) Fees (all except Membership)"
- Generate a Paypal Statement for the quarter. Class sales should be already summed up as "Express Checkout Payments" in "Payments Received". Enter this as a deduction "10(f) Educational classes that do not include tangible goods sold". Also, add this to Square Sales and enter this is our Total Gross Sales for the quarter.
- Find all receipts for online purchases such as QBP Tools, QBP Consumables and Amazon orders and sum up all untaxed items. Enter this into the form as "Purchases Subject to Use Tax"
This should be all the information needed to report the sales and use tax.
