ChickenHead

Very Easy. You bill your client the entire invoice. You then get payment and enter the payment, making that invoice paid. Then you go into your paid invoice each time you do any pre-paid work, list out the date, enter your service performed, and 0.00 for the charges If you deduct any amounts (vs 0.00) it removes them and will then show as OWING AND NO LONGER PAID! Leaving the invoice outstanding and owed This way inside the paid invoice, it keeps track of everything you do with that client/internally. Which can always then be printed to provide a trail to the client (if ever need be) In your internal comment section, you keep track of any time remaining each time you make a deduction/addition for work performed

As far as Express Invoice is concerned, you bill for the parts the same. If it's cost vs even if you make some money on the part, you still bill for that amount. Being taxed on it, as far as Express Invoice goes, that goes for wherever you are located and the jurisdiction tax laws. Such as I am in USA. My tax is singular, so if the part is XXX.XX, then in on the invoice, I put that amount in, then whatever the tax is for XXX.XX, then the program automatically adds that tax amount into the invoice. This is the correct way for most business. Tax report shows the amount due. However, if you are speaking about, if you went to a retail store, paid $10.00 for a part and then paid a tax for that part, say raising the cost to $11.50 (as an example), then in your TAX Report, it's going to show you owing for that TAX a second time. So what you do then, inside of Express Invoice, all you do is go into your ITEMS area, create a nice little name (call it TFPARTS as example/Reimburse) give it $1.00 value, select the TAX button, change it from Default to NONE. Each time you enter in a part you buy and already pay taxes on, you enter TFPARTS, Enter the name and then the amount you'll change from the $1.00 it shows, to your amount you paid total and no additional tax is then added. Since that item in your item list is set to NONE for tax! Then on every invoice that you had to enter parts you already paid taxes upon, you would then list your total and no taxes would show up on your report. Which then, if caught and you face an audit, you will want to make 100% certain you have every receipt to account and show, in fact you did pay the taxes on them! Which is a true accounting nightmare. But if you print 2 invoices, one for your customer and one for yourself. Take your receipts where you bought the parts, make your copies (due to most printed receipts will fade) and staple your copies to your own invoice and file it for end of year. (and the next 7) Another way you could do this is just be honest and up front (since you're not making any money on the parts). On your invoice list what your service includes. Let's see, your a small computer company, so let's say you bill for service; Service: R&R internal Hard Drive, copied data, checked system for errors, etc, system shows all signs of being 100%. Amount Due: $150.00 (whatever) Comments form on bottom: pre-paid parts included in total of job. This way, no tax reports to deal with, you get paid the $150.00, end of the year when you file your taxes, your purchased items are deducted from your profit and so on, and you are staying legal. No difference from sending your client out to buy the parts at the same cost. It's still pre-paid. Easy to explain to your customer. State and jurisdictions have still already got their money, and you're not having to pay double taxation. (same as above) and still staple your copies to the invoices and file them. Far easier just to properly register your company from the start, buy your items TAX EXEMPT and charge the appropriate tax and pay it. Do it right. Tax isn't and shouldn't be a fear and it's pennies on a dollar. Just do it right and you'll have no problems. You way above, you collect the $100 fully. You then report that you made $50.00 total. Come tax time, you are then filing your taxes for the amount of $50 and not the $100. Then you should be taking your purchased amounts of parts and deducting those as an operating expense. If in fact you are filing your taxes, you have just filed you made $50 and now saying, Oh, I'm deducting $50 for the part I paid for... therefore I made ZERO on that sale. That's filing false taxes! As in the proper way, it would be you made $100, you paid $50 for the part, therefore your net is $50. you pay taxes now on the $50! Still the same, but you're allowed legal deductions, which really helps offset what taxes you may wind up owing. Always show in your reports. With the proper accountant, you'll probably find out, doing it right, you'll wind up paying less in taxes as how you have been going about it all this time. Zeroing that out so it won't show on your report is the wrong way to go about it Though you may be getting by, get yourself some help, talk with an accountant. And don't use any that claims anything to do with dodging anything. Do it right. Not worth it in the end. Hope it helps!