Reconcile returns with consumer use tax
This article applies to:
You might see consumer use tax on a return depending on the form being used and how the invoice or inventory transfer documents were created. If the consumer use tax amount is different than what you expected, investigate what caused the discrepancy to determine if you need to address it.
Before you begin
- Your returns need to be set up and approved by Avalara.
- In Avalara, go to Manage and Approve Returns or File Returns, and click Refresh
to make sure the most recent transactions have been added to the page. - If, after refreshing, there's still a discrepancy between the consumer use tax amount and what you expected, you need to reconcile.
Steps
- On the page that lists all the returns you're filing in a region, make sure the return includes consumer use tax.
- Check for overrides on your transactions.
- If you override the tax amount on a transaction, AvaTax assumes you already paid that amount of tax and doesn't include it on your returns. For example, if AvaTax calculates a $7.00 tax on a transaction, and you override the tax amount for $5.00, Managed Returns remits $2.00 on your behalf instead of $7.00.
- If you override the accrued tax amount on a transaction, AvaTax includes the accrued tax on your returns but doesn't add to the total taxable sales. For example, if you owe $10 of taxes on $100 of sales and override the accrued tax amount on a $20 transaction, your reports would say you owe $10 on $80 of sales.
- Check for carry-over credits and vendor discounts. These reduce how much tax you need to pay.
- Check the filing frequency. If it's in the middle of the filing cycle, then the return shows tax collected but nothing due.
- Check if the return is associated with a location code. If it is, transactions without that location code aren't used on the return, and you won't see the tax from them.
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Other reasons you may not see consumer user tax on your return:
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