Sales invoice with discount Before or after Tax
Varadharaj V
Apr 20, 2022 - 6 mins read
Sales invoice with discount Before Tax and after Tax. We cant invoice the customer with same money that you bill them. you might need to provide certain discount on it. It applies before tax and after tax. It depends on the customer and business it varies. Let's say some customers who are new to us and they are not sure about our product or service. To attract or maintain such a new and well versed customers, we need to provide the first invoice with discount on its price. usually most of the service industry offers the same with their new customers.
TamilAccounting
Example, in our subscription plan also we have trail period to test our features of TamilAccounting. Once it meets your needs and satisfy the possible features. You are going to be with us by taking the business to new level with people.
Discount Before Tax
This situation is something both benefited, and we are going to tax the customer with discounted price. and doesn't make you to pay more on taxes. simply, you pay what you sell it to your customer. This is wide preferred. And also this kind of discount usually applied to continue on the regular basis. Suppose in the Subscription plans and certain purchases.
Discount After Tax
This is usually happens with one time discount. and the Seller has to pay the actual tax. but the sales will be done for the price of the discounted one. Normally its less benefited for the sellers. And ofcourse, this is kind of discount after tax is also available in the market.
Finally, the discount after Tax is one time, and its taxed on original price and given discount after the tax applied price. Which is purely more than your profit you are paying as tax. and its not advised to Tax this way. Whereas the Discount before Tax is a good practice and which will be incurred only the selling cost tax. We don't need to pay more than the selling costs tax.
