Square Inclusive Sales Tax - is the tax in a separate column in the reports?

[here4TheCheese]

If an item has an inclusive sales tax, is that sales tax on its separate tax line in the reports? (ie Transaction reports)

Ex. 
My item costs $10 and sales tax is 10%. The cost the customer pays is $11 ($10 item + $1 tax).

• In Square I create a sales tax, check the box to make that sales tax inclusive (rather than additive).
• I create an item, choose "Taxes" to be the 10% inclusive sales tax, then input the item price as $11.
• When I create a test transaction, the customer is properly charged $11 total. 

I want to ensure that the reports will show this inclusive tax on its own line. Will the report show this transaction as a Sale of $10 and a tax of $1?

[TheRealChipA · Accepted solution]

Hi there @here4TheCheese.  When you sell items that are tax-inclusive, Square breaks that up internally as “product/service sales” and “sales tax.”  So on standard Square reports, your gross sales for that item would be $10, and your sales tax would be $1.  This is true for all standard Square reports.  If my memory serves me correctly (back when I did inclusive sales taxes, which I stopped doing 8-9 years ago), receipts even show the “included” sales taxes paid.

[here4TheCheese]

This is how I hoped it would show up! Your answer alleviates some of my worries going into our first festival this week.

[TheRealChipA]

Glad to help @here4TheCheese.  I so have one question/concern to voice, though.  Do you ALWAYS include sales taxes in your item prices?  I ask because — in my state at least — we can not mix and match.  We have to choose to either ALWAYS add sales taxes or ALWAYS include them, for all items at all times.  When I switched, I had to go all in.  So check with your accountant/state if you want to do something different for festivals than you do for other sales.  You might be violating the law and not know it until you are fined.

[here4TheCheese]

That's concerning. I don't have an accountant and don't know exactly what search terms to peruse to find out if this is a problem for me in Oklahoma.
Searching for Kentucky tax laws (the state you appear to be in) doesn't bring up anything that would warn me about this rule.

[TheRealChipA]

My accountant warned me about it.  But, that was almost a decade ago, so they might have changed it by now.  Who knows?  If you can’t find anything online, I would recommend a call to Oklahoma’s sales tax office, then.  Better safe than sorry.  

And, speaking as a long-time business owner, I would highly recommend spending the money on an accountant — especially for when tax time rolls around.  Too many people try to do it alone and end up making costly mistakes without one.  If you really, truly can’t afford one then check out a group called SCORE.  They are an organization that provides business mentoring services with an emphasis on local/state laws and regulations.  Many of their services are free of charge and those that aren’t usually are much less expensive.  Again, it’s money well spent to stay out of legal trouble.

[Candlestore]

@here4TheCheese ;

On your device or in your Square Dashboard Look for Transactions.  Then in the Transacations look for the date and Test Transaction you tried for the $11.  You should be able to see this and near the bottom it should show Item charge and Tax applied or similar wording with the Total of $11.  Now on your Report it may not Show 2 different taxes for Included or Excluded totals but just give you a Total of al the sales tax you collected and would owe for the time frame.  If you export one of your Transacation Csv files one of them should show you these 2 columns.  This export would be through the Webrowser Square Dashboard > Transactions > Export.  

[here4TheCheese]

I didn't actually finish the transaction out - just input it to see how it would show up to the customer. So there is no report for this item's transaction unfortunately.