Canadian sales tax incorrectly calculated when bill includes a tip

gbh Expensify Customer Posts: 1 Expensify Newcomer

Expensify looks at the bill total, and if I indicate a specific tax rate, it backs it out from the bill. However, for meals, most include a tip. According to the Canada Revenue Agency "A tip or gratuity that is freely given by a customer, for example, cash not recorded on a bill, is not subject to the GST/HST." However, expensify is incorrectly recording it as subject to GST/HST.

Is there a way to have a single bill and have some of the bill subject to tax and another part of the bill (the tip) tax free?

The current system allows manual override of the tax but this defeats much of the fantastic automation of Expensify.



  • Sheena Trepanier
    Sheena Trepanier Expensify Team, Approved! Accountant, Expensify Student Ambassador Posts: 1,362 Expensify Team

    Hi @gbh - great question! Currently there isn't a way for our system to apply tax to a partial total without the expense being split first.

    To track the GST/HST portion of the expense separate from the tip portion, the expense would need to be manually split first. Then, once split, tax could be applied to the taxable bit.

    If you had an idea for an elegant solution, we'd love to hear about it in our Ideas category!

  • AnotherCharles
    AnotherCharles Expensify Customer Posts: 1 Expensify Newcomer

    If the SmartScan can't be made smart enough to find the subtotal and/or tax amount on a receipt -- a less confusing solution would be to add a user-modifiable taxable subtotal field that defaults to the scanned total and which is used to calculate the tax. The slight improvement is that it eliminates manual calculation if

  • littledogie
    littledogie Expensify Customer Posts: 1 Expensify Newcomer

    I am just getting started with Expensify and discovered this issue right away. So far I've been manually correcting the tax value based on what's reported on the receipt. There are a few options I can think of to improve this... probably the best would be to get SmartScan to find the receipt's Subtotal automatically (since most receipts will report one) and apply the tax to that value. Then we would only need to manually adjust when the receipt's subtotal isn't obvious. (Alternatively, I have also seen other software that is able to detect a tip amount on the receipt - which would allow for creating a policy that either includes or excludes it in the tax calculation.)

  • Sheena Trepanier
    Sheena Trepanier Expensify Team, Approved! Accountant, Expensify Student Ambassador Posts: 1,362 Expensify Team

    Hi there @littledogie and @AnotherCharles, thanks for weighing in! I've chatted with my team about this and I've learned that we're working on some pretty big improvements to SmartScanning and what information we populate with SmartScan. I don't have an ETA or more information I can share on those changes, but I did want to let you both know we're aware of this need and working to address it.

    We will, of course, announce any product changes or updates here in the Community, so I hope to be back with good news for you all in the future!