On 3/31/21 11:33 AM, Stan Brown wrote:
On 2021-03-30 20:22, Jack Frillman via gnucash-user wrote:
Doesn't everyone track their sales tax as a separate expense item? Why
would you consider sales tax the same type of an expenditure as
groceries, gasoline or your electric bill?
I record it separately because it isn't part of the expense of the item.
It is a separate charge. But more practically, what do you do when you
buy both groceries and household items on the same receipt? Do you just
lump it all together? Do you track those two things separately? Then do
you have to aggregate the tax to each one?
(it is so much easier to just enter each receipt line-by-line, including
a tax line, auto-fill will save you many key presses in short order)
As far as I'm concerned, taxes are part of the purchase price. Sometimes
they are disclosed, other times not. If they're not disclosed, then
obviously I can't account for them separately. When they are disclosed,
I suppose I could account for them separately; but that would create an
inconsistency in how I accounted for different categories of expenses
and assets.
To each their own. I enter it separately both for accuracy and
practicality. (noted above) That also makes it consistent. Yes, I do
record them even when not explicitly on the receipt, but there is only
one case of that...
For instance, in the US there are State and Federal excise taxes on
gasoline. But the price on the pump includes that excise tax amount; it
is what we actually pay. It would seem absurd to me to ferret out the
tax amounts and account for them separately.
I know my State and Federal rates. Those are the first splits in each of
my fuel transactions. Those are followed by the actual fuel expense.
I also get to see this way how much I'm really paying for government. It
sounds silly at first, but auto-fill does most of the work.
I states that have a sales tax, my restaurant bill consists of the price
shown on the menu, the sales tax on that amount, and whatever gratuity I
choose to add. The sales tax is de jure part of the cost of my dinner;
the gratuity is de facto part of the cost because of longstanding
custom. Even though these are stated separately, it would seem absurd to
me to account for them separately.
I record all of these separately as well.
The tax part I've already covered. But I record the tips separately too.
I've used this to great effect to refine my budgeting for dining
dollars. Some may think it is overkill, but it helped me get it under
control. It worked for me, but others may not need it.
Regards,
Adrien
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