---
title: "Sales tax added to a refund when it shouldnt be"
slug: "how-to-issue-a-refund-without-adding-sales-tax"
tags: ["Area - Accounting", "Focus - Construction", "Focus - Service Replacement", "Role - Accountant", "Role - Admin", "Type - Commercial", "Type - Residential"]
updated: 2026-10-15T02:20:05Z
published: 2026-10-15T02:20:05Z
canonical: "help.servicetitan.com/how-to-issue-a-refund-without-adding-sales-tax"
---

> ## Documentation Index
> Fetch the complete documentation index at: https://help.servicetitan.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Sales tax added to a refund when it shouldnt be

![](https://cdn.document360.io/961862ab-d0f2-4d91-bb62-a62ee8184eff/Images/Documentation/anvil-wrench.png?sv=2026-02-06&spr=https&st=2026-11-09T11%3A27%3A07Z&se=2026-11-09T12%3A27%3A07Z&sr=c&sp=r&sig=AVoEqo408ALJYGaM%2BepXxpPKO5h3mTROYV0as9AakiI%3D) Troubleshooting **Role:** Administrator · Bookkeeper · Office Admin**Area:** Pricebook · Refunds · Invoicing · All product versions

## **What you're seeing**

You issue a refund, but ServiceTitan adds sales tax to the refund amount even though the original charge wasn't taxed (or the customer is non-taxable). The refund comes out higher than what the customer originally paid. This can affect a single refund or every refund that uses the same refund task.

- **Where you see it:** the refund or adjustment invoice on the customer's account.
- **Where you fix it:** Pricebook **> Services** (the refund task's **Taxable** setting).

## **Why this happens**

There is 1 common reason.

**Reason 1**

**The task used for refunds is marked as taxable in the** pricebook**.** When a taxable task is added to a refund or adjustment invoice, ServiceTitan calculates sales tax on it the same way it would for any taxable line item.

## **How to fix it**

Run these steps in order.

> [!NOTE]
> **Note:** You need Pricebook permissions to edit Pricebook services. If you don't have it, contact your administrator.

> [!NOTE]
> **Caution:** Before reprocessing a refund, cancel any earlier attempts for the incorrect amount in the Transaction Gateway. This avoids issuing duplicate refunds to the customer's card.

> [!NOTE]
> **Caution:** Clearing the **Taxable** setting stops tax on future refunds. It does not change refunds or adjustment invoices that were already created — those have to be corrected on the invoice itself (Step 7).

> [!NOTE]
> **Note:** Depending on your account's configuration, you might see one or more of the following:
> 
> - *Items and Pricing* instead of *Pricebook*.
> - *Customer* instead of *Homeowner*.
> - *Procurement* instead of *Inventory*.
> 
> The names are different, but everything works the same way. For more, see [Commercial Personalization Platform - FAQ](https://help.servicetitan.com/commercial/docs/commercial-personalization-platform-faq).

### **1****Clear the Taxable setting on the refund task**

Use this to stop tax on future refunds and correct any refund already created with tax.

1. Go to the navigation bar and click Pricebook.
2. In the side menu, click **Services**.
3. Search for the task you use for refunds.
4. Click the **More** icon for that task and select **View/Edit Service**.
5. In the **Details** tab, clear the **Taxable** checkbox.
6. Click **Save**.
7. If a refund or adjustment invoice was already created with tax, remove the labor task from the adjustment invoice (or the refund task from the refund invoice) and re-add it so the balance recalculates without tax.

> [!NOTE]
> **✓ Done ·** New refunds that use this task no longer include sales tax, and the corrected refund total matches the amount the customer originally paid.

## **Still not working?**

Contact ServiceTitan Technical Support at [**go.servicetitan.com/ask**](https://go.servicetitan.com/ask) with:

- The customer name and the affected invoice or refund number.
- The name of the refund task and a screenshot of its **Taxable** setting in Pricebook.
- The expected refund amount and the amount that actually processed.
- Which steps from this article you already tried.

## **Want to learn more?**

[**Invoice tax showing incorrectly or not removable ›**](https://help.servicetitan.com/commercial/docs/how-do-i-remove-tax-from-an-invoice) Remove or correct tax on an invoice when it shows incorrectly or won't come off.

[**Refund won't process or the Refund option is missing ›**](https://help.servicetitan.com/commercial/docs/how-to-resolve-error-when-issuing-refund-in-servicetitan) Resolve errors or a missing Refund option when issuing a refund.