Suppose I tender a sale on a customer's account, to be paid in 30 days.
Am I supposed to pay the Sales Taxes for the sale on the month the sale occured in, or once the invoice has finally been paid?
Suppose the customer never pays his bill? Then I may be paying taxes to the government on a delinquent sale? Does that make sense?
That's right - you are responsible for tax in most states as soon as the sale is executed, regardless whether the customer pays at that time.
However, there is differing opinions about what happens if the customer does not pay. From what I understand, in some states (and countries for that matter) you can recoupe the sales tax if the customer never pays. Essentially, instead of simply writing off the bad account, you can "return" the sale on account which would give you negative tax, then adjust you inventory for the item the customer "stole" which writes off the value of the lost inventory. The net effect is that you do not pay for tax that you never collected.
Consult your accountant/tax attorney.
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