Sales Tax Reports Step-By-Step

SALES TAX REPORTS Step-by-Step
In a recent blog post I talked about possible problems Amazon FBA sellers have when using Amazon to collect sales tax and provide reports. This accompanying Step-by-Step shows how to find your sales tax reports on Amazons SellerCentral and check them for accuracy (pages 27). In addition, it looks at three potential problems: 1) Amazon not collecting accurately (page 6); 2) improper product tax codes (pages 6-16) and 3) incorrect Amazon tax settings (pages 17-19). While only Amazon can fix the first problem, you can fix the second two. I cover how to fix them with screen shots and simple directions. See the next page to begin!
2013 MyPromote Books. All Rights Reserved.
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1. Go to https://sellercentral.amazon.com and login to your seller account. 2. Once inside, go to the Reports tab and select Tax Document Library
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3. You will see a screen with all your available tax forms including your 1099-K if your 2012 sales were high enough and your sales tax report options.
4. From here you can create the kind of report you need. For some states like Arizona, I pay monthly. For others I pay quarterly. For some, like Texas, I now pay annually. Click on Generate a tax report.
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5. Select a monthly report or custom report. Amazon will think for a few minutes as it processes your report and you will be notified when it is ready. Or you can just wait. Shouldnt take too long. Click on the yellow Request Report button to the far right of your report or the gray Download tax report. Ive seen both pop up on my screen. Regardless, when you click on the Download tax report button, you will get a .csv file which is easily read by Microsoft Excel and other spreadsheet programs. Once you open it, it will look messy because everything is squished together. The first thing I do is format the column width so I can see everything clearly. First, select the entire spreadsheet by clicking on the upper left-hand corner. This will select all the columns and rows. (see picture on next page)
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6. Next, choose Format and Auto-fit Column Width. Depending on your program, this may be located under a different tab. I use Excel and this function is found on the Home tab.
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7. Now your columns are easy to read. Next go to columns AD-AK. AK is Non-Taxable_Amount and AL is Taxable_Amount. Column AG is the Tax amount charged to your customer and AH is the rate that was charged. So far, so good. 8. Lets look at one of my transactions for Arizona. Arizona is one of those states where we need to report for the state and for Maricopa County where the warehouse is located. Key cities also have their own tax rate on top of the state rate.
9. For this $8.99 book, Amazon collected 76 cents. You can see this in column AG. The tax rate is AH.
10. The item above was sold to someone Philadelphia. In Pennsylvania, there is an additional 2% sales tax charged for Philadelphia but Amazon did not collect it in this case. For some reason it says Not Applicable. This is how I knew something was wrong with my report and placed a call to Amazon.com. Only they can fix this problem. If you dont know how to reach Amazon, see my blog post: www.fbastepbystep.com/help for instructions.
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11. You can use this report to help you file your sales tax. You will need two numbers, the gross for each state and the tax collected for each state. The gross sales for each state can be found by adding up column AL for each state. HOWEVER, be sure to look at column AK as well. This is where the exempt items are listed. If you dont sell exempt items, this could indicate a possible problem.
12. This is a potential problem for me because I dont sell exempt items. This was how I learned that many of my items were tagged as exempt and needed to be fixed. To figure out what was going on, I looked at column M and saw immediately that was my problem:
13. So what did I do in this situation? First, be aware that if you have this problem, you still owe your state the sales tax even though Amazon did not collect it for you. I added the $21.95 to my gross sales and paid tax on it. The state of Texas allows us to file online and only needs the gross sales. It figures the tax for me and even gives me a discount for paying early. Very simple.
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14. The next thing I did in this situation was fix the problem with my listings so that that they all say A_GEN_TAX instead of A_GEN_NOTAX. First, go to Seller Central and click on Add Products Via Upload under the Inventory tab:
15. Next, you want to download the Upload Template. Please note, this excel spreadsheet has three tabs or spreadsheet pages. The first one is instruction. The template will be empty. You need to populate it.
16. Open the template with your Excel or other spreadsheet program. Click to the third tab that says InventoryLoaderTemplate. 2013 MyPromote Books. All Rights Reserved. Page 8 http://www.fbastepbystep.com
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17. In order to populate the report, you need to put all your active SKUs in the first column. There are 15 columns. You do not need to fill all of them, just column A seller-sku, column L fulfillment-center-id and column M product-tax-code. Ill show you what that looks like in a minute. First you need to download a report from Amazon with all your active SKUs. You will cut and paste those SKUs into this template. Go to Reports and click Fulfillment. You will then select Manage FBA Inventory which gives you your active inventory as of that moment. Click on Request Download.
18. This gives you a near real-time report of your active inventory and can take up to 45 minutes to prepare. Go grab a coffee and check your email. When the report is ready, download it. It will be a text file. Your best bet is to save it to your hard drive and use your spreadsheet program to open it NOT Notepad. It is too hard to edit the file in Notepad. The file is deliminated. Be sure to check that option when opening it in Excel or other spreadsheet program.
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19. You will see a lot of information. What you care about is column A which is for SKU. You will select that column by clicking on the A. It now selects the entire column. You want to copy this column. Using the right click button you can choose copy. Alternatively, an option to copy should be at the top of the spreadsheet.
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20. Go to column A of your template spread sheet and paste your SKUs into it. 21. Next go over to column M product-tax-code. You need this column to say A_GEN_TAX all the way down. The easiest way to do this is to type in A_GEN_TAX at the first row. Next, select pull down on the lower right-hand corner. This will copy the text A_GEN_TAX into all the rows of Column M. See the picture below:
22. Continue pulling down until the entire column M says A_GEN_TAX. 23. Do the same thing for Column L. It needs to say AMAZON_NA. If you dont do column L, all your items will convert to merchant fulfilled. Eeek! 24. Now you have a spreadsheet that only has content in Column A, L, and M, plus all of row 1. You need to save this file as a text file NOT a spreadsheet file. It will end with a .txt extension. If it says Excel Workbook or something else, youll need to choose Text (Tab deliminated). Save it to your hard drive.
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25. You are now ready to upload your changes. Go back to Seller Central. Open Inventory and Add Products via Upload.
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26. Under Upload inventory files you will select Inventory Loader File.
27. All you want to do here is select your text file. DO NOT choose purge. It will be bad. You DO have your original active listings file as a back-up so it is not a catastrophic mistake, but lets not go there. Dont select anything else, either just browse for your text file:
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28. After you choose your text file, Amazon will start processing your batch. It can take a few minutes. If you scroll down on the same page you will see your Inventory file upload status. When your file is done, it will show you how many files were successfully updated. This screenshot is from an inventory fix I did in March. In the case in March, I chose to change all my files including inactive files because I felt many of the items (mostly books) might become active again in the future and I wanted to make sure they were properly labeled as taxable. Later I realized I did not need to do that since Scan Power had changed my settings on their end. Everything I upload is taxable:
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What if your items are already set to A_GEN_TAX and Amazon isnt collecting properly? Either you have problem 1 which is an Amazon problem and needs to be fixed by them, or your settings are off. Youll want to check your settings first before you call Amazon: 1. Inside Seller Central, go to the Settings tab and choose Tax Settings.
2. This Step-by-Step assumes that you are already set up in one or more states for Amazon to collect your sales tax. In this case we will be checking your settings. First, click on the link that says View/Edit your Tax Collection Obligations. Scroll down to just below point 4. Ive removed my personal sales tax certificate numbers from these screenshots. Just be aware that you have to have a sales tax certificate for a state before Amazon will collect sales tax for that state.
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3. First you want to make sure that your default product tax code is A_GEN_TAX. There are other options which are more appropriate for manufacturers of specific products like food, wine, magazines, etc. For most FBA sellers A_GEN_TAX covers us even if you also sell food, wine, magazines, etc. 4. Next, for your chosen states, you want to select State, County, City, and District. Sometimes the reason Amazon isnt collecting properly for you is that youve only selected State and not County, City and District. Again, Ive removed my state registration number. You should see yours in this box by each state in which you are registered. 5. For some states, like Texas, you can choose one overriding rate and not break out county by county. I chose a custom rate and then put in the rate. Heres what that looks like:
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6. Next, click the acknowledgement and continue.
7. This should fix your problem. If your settings were already correct and Amazon is still not collecting correctly at the county, city or district level, you need to call them. Be aware that not every state has county, city or district taxes. I knew for a fact that Arizona and Pennsylvania did which is why I had you look at them in your report. Other states may be 0 simply because there is no tax collected at that level.
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2013 MyPromote Books. All Rights Reserved.