Sales Tax & Selling Discount
Suppose you sell 8 items and want to discount the sale. The sales tax collected should be on the total of the items less the amount of the discount.
Enter all your items that are being sold, then enter a subtotal item. Then on the next line enter your discount item. Insure that all items are marked as taxable. QB will calculate the new total (subtracting the discount amount) and calculate the sales tax based upon the new total.
The discount item is interesting (other charge item), when you set it up it asks for an amount or a percentage and that is what shows on the invoice when you use it. but you can click in the rate column on the invoice and change it to a dollar amount or any other percentage, just make sure you use the negative sign. When you set up the discount item make sure you use the negative sign in the rate column or QB will think it is a charge, since the item being used is an “Other Charge” item.
