Jump to content

Tax incorrectly calculated?


Recommended Posts

For an invoice that has the following items:

  • Item A @ 359.88$
  • Item B @ 203.88$
  • Item C @ 119.88$

the total is 683.64$.

If I apply a 5% tax to every item, here's what Sage is doing:

  • Item A @ 359.88$  x  5% = 17.994$, Sage rounds it at 17.99$ (0.004 is lost)
  • Item B @ 203.88$ x 5% = 5.994$, Sage rounds it at 5.99$ (0.004 is lost)
  • Item C @ 119.88$ x 5% = 10.194$, Sage rounds it at 10.19$ (0.004 is lost)

Now, Sage adds up all of the their calculated tax amounts: 17.99$ + 5.99$ + 10.19$ + 8.40$ = 34.17$

But, if we keep the fractions of cents, the real amount should be: 34.182$, rounded to 34.18$.

Also, simpler: adding all of the items amount and then calculating the 5% tax on the total gives the same results as 34.182$, rounded to 34.18$.

So, we lose 1 cent in this example with Sage's calculations.

I bring this up because this was a real-world example of an invoice generated with Stripe (which charged the customer) and which doesn't match what Sage calculates, which brings complexity with our financial department. We need to adjust the certain invoices where the taxes are incorrectly calculated.

Is this a bug, or I'm doing something wrong?

I have attached a screenshot of an example invoice with this example.

Screenshot 2024-02-02 at 8.22.26 AM.png

Link to comment
Share on other sites

Please sign in to comment

You will be able to leave a comment after signing in

Sign In Now

  • Create New...