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Chapter 6. Collecting and Paying Sales T... > Taking a Discount for Early Payment

Taking a Discount for Early Payment

If you pay your sales tax early or on time, you might have an opportunity to take a discount for the timely payment. If you simply reduce the amount you pay in QuickBooks, it will look like you didn't pay the entire bill and you'll still carry a liability on the books. Instead, you can account for the discount separately. You can enter the discount in your company records, which reduces the amount due, and then when you're ready to pay the tax, the correct amount appears.

Take a Discount for Early Payment

Open the Chart of Accounts by pressing Ctrl+A.

Double-click the Sales Tax Payable account to open the register associated with this account.

In the transaction at the bottom of the register, change the date if necessary to the date the discount is issued, or leave today's date in place.

In the Vendor area, enter the name of the government agency to which you pay the sales tax.

In the Paid area, enter the amount of the discount.

In the Account area, enter the account where you want to record the discount.

Enter an optional memo describing the discount or the month to which the discount applies.

Click Record to save the transaction.


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