Per-Item Tax and Total Tax Not Equal

When using ServiceTrade's sales tax calculations on invoices, you may periodically notice a discrepancy between the sum of the displayed per-item tax amounts and the total tax listed at the bottom of the invoice. This article will advise users on how and why this discrepancy exists for tax calculations.

Notice in the above image that if we add the displayed per-item tax amounts, we receive a total of $11.41, while the total tax listed below is $11.40.

This scenario occurs because rounded per-item tax amounts are shown for the convenience of ServiceTrade customers, but the actual tax charged is calculated based on the invoice subtotal.

Many of the accounting platforms that integrate with ServiceTrade calculate their tax in this manner. The image below shows, in greater detail, the calculations that are occurring behind the scenes in the ServiceTrade app.