Discount Before or After Taxes?

Discount Before or After Taxes?

Discount Before or After Taxes?

SOLVED
Porsche
I'm a Contributor Level 1

Discount Before or After Taxes?

Are discounts applied to totals before or after taxes?

 

A) 50 * 1.12 (taxes) = Total - Discount

 

OR

 

B) 50 - Discount = Total * 1.12 (taxes)

 

A or B?

 

 

Accepted Solution

Re: Discount Before or After Taxes?

Solved by Former Moderator FidoCatherine

Hi there Porsche

 

Whether they're applied before or after the taxes depends on the type of discount.

 

The Refer a Friend credit is applied after taxes, as well as the FidoDollars.

 

Hope this helped clarify 😃 

 

 

View solution in context
19 REPLIES 19
KAPABLE-K
MVP

Discounts are added before taxes, so B final answer Smiley



Porsche
I'm a Contributor Level 1

That's what I thought, but Fido did the opposite on my bill. The discount is the "Refer-A-Friend" discount. The agent said because it's a one-time thing, it's applied after taxes. Is this correct?

Hi there Porsche

 

Whether they're applied before or after the taxes depends on the type of discount.

 

The Refer a Friend credit is applied after taxes, as well as the FidoDollars.

 

Hope this helped clarify 😃 

 

 



Porsche
I'm a Contributor Level 1

1) Why does it matter what kind of discount it is?

2) If I walked into a store and bought something, the discount is applied before taxes. How is this different?

3) Is this an industry-accepted practice? I've never had a discount applied after taxes with any other carrier.

 


@Porsche wrote:

1) Why does it matter what kind of discount it is?

2) If I walked into a store and bought something, the discount is applied before taxes. How is this different?

3) Is this an industry-accepted practice? I've never had a discount applied after taxes with any other carrier.

 


Hello Porsche,

 

  1) A discount is a reduction in the cost of services. If your services cost X dollars before you receive a discount, after discount your services would cost X-discount dollars. Since the cost of services is reduced, discounts are applied before taxes. On the other hand, credits (and FidoDollars) are like cash or gift cards. They have no bearing on the actual cost of services. If your services cost X dollars before you receive a credit, your services still cost X dollars. As such they are applied after taxes.

 

  2) If you walked into a store and they had 10% off discount, then yes, 10% would be reduced from the price of the items before tax. On the other hand, if you have store credit or a gift card, those have no bearing on the end price of the items. The store credit or gift card only come into play after everything has been totalled -- after taxes.

 

  3) Not only is it accepted practice within the mobile industry, it is generally accepted within commerce. If you wish to compare with other carriers or retailers, definitions (from first part) are important. Fido doesn't apply discounts after taxes either. I'm sure other carriers would also apply credits after taxes as well.

 

  Hope this clarifies matters Smiley

 

Cheers

 

 



@Porsche wrote:

1) Why does it matter what kind of discount it is?

2) If I walked into a store and bought something, the discount is applied before taxes. How is this different?

3) Is this an industry-accepted practice? I've never had a discount applied after taxes with any other carrier.

 

Answer.

1) Because it does matter 

2) You did not walk into a store and bought something

3) Yes




Because the refer a friend is a credit not a discount to your monthly service, you can look at it as if it was a gift card. So you are mixing up discount with the refer a friend credit.


Porsche
I'm a Contributor Level 1

Okay, so in accounting terms or for tax purposes, what's the difference between a discount and a credit? I've never had a a credit applied after taxes before either.

Why should the $25 credit be applied before taxes? It has nothing to do with your monthly services its not a discount on your monthly services. Its like this if you over paid your account by $25 now you have a $25 credit on your account on your next bill are you expecting that $25 will be applied before you get charge the taxes on your monthly services?


Porsche
I'm a Contributor Level 1

No Fido employee going to answer?

Good morning @Porsche

 

The information in the thread is accurate Smiley 

 



Porsche
I'm a Contributor Level 1

I wasn't asking if the information in the thread is accurate or not. I asked three questions in my previous post. Please attempt to answer them.

I wouldn't be able to make it any clearer than @KAPABLE-K did. 



Porsche
I'm a Contributor Level 1

You confirm the exact horrible customer service that Fido has as mentioned in my very first post. The reason why I asked those questions is because I do not understand how this billing policy works. As I have mentioned, I have never had this happen to me with any other carrier that I have been with.

Your lack of actual service exemplifies how much Fido really cares about its customers. If you can't find a way to make things clearer, then you give the customer a way to find the answer either by providing a phone number to talk to a department that is in charge of these billing issues. It's called providing customer service. You might have heard of it.


@Porsche wrote:
You confirm the exact horrible customer service that Fido has as mentioned in my very first post. The reason why I asked those questions is because I do not understand how this billing policy works. As I have mentioned, I have never had this happen to me with any other carrier that I have been with.

Your lack of actual service exemplifies how much Fido really cares about its customers. If you can't find a way to make things clearer, then you give the customer a way to find the answer either by providing a phone number to talk to a department that is in charge of these billing issues. It's called providing customer service. You might have heard of it.


 

I do not work for Fido or provide customer service for them. I'm just a community member attempting to help another community member.

 

From how you are acting no one can help you, you are not looking for answers because if that was the case you should have understand how the referal credit works by now. You just want to get your own way and because you are not you want to say the company has bad customer service. I'm all for saving a buck and i've done multiple referrals in the past and got my $25 credit and was happy. 

 

 

 

 



Porsche
I'm a Contributor Level 1

First of all, I did not say that you worked for Fido. In fact, I clearly asked a Fido representative to respond to the questions as the questions could be clearly responded to by an employee with knowledge of company protocols.

Secondly, not once did I ask for anything. I did not ask to be reimbursed nor did I ask for anything to be reversed. As far as I see, I asked for clarification and the official stance on this because as I have mentioned, this did not happen with OTHER carriers. As far as a mature person should see, asking questions is a form of finding out answers.

Compare your answers to the answer from the member above this post. Now THAT'S helping someone. Thank-you!

Well i'm glad you finally understand and thats all that matters.



Don't forget to keep this friendly guys. Smiley

 

@Porsche If a question is answered we don't intervene unless there's some information that needs to be corrected. We want to let everyone in our forums have a voice, but you can always ask us if the information is valid or not in case you're worried. As @FidoSamantha explained, the information given by @KAPABLE-K is accurate.

 

 




@FidoTerry wrote:

... As @FidoSamantha explained, the information given by @KAPABLE-K is accurate...

 


Hello,

 

  There's a difference between simply providing information, and explaining information. In this case, the information was previously provided, but the request for an explanation was overlooked. We have to remember that not everyone is as familiar with the information (terminology) as we are since we deal with it more frequently.

 

Cheers