Learn how tax is handled when customers purchase Wallet Balance and later use it to pay for services or products in Zylu.
With Zylu Wallet, a customer may pay a certain amount and receive a higher Wallet Balance as part of the wallet offer.
The customer:
Pays $1,000
Receives $5,000 Wallet Balance
The $5,000 is the customer's available Wallet Balance for future purchases.
The tax applicable when the Wallet is purchased is based on the Wallet purchase transaction.
The $5,000 Wallet Balance is not a prepaid tax amount for future services.
When the customer uses the Wallet to purchase a service, tax is calculated on the actual service purchased.
The Wallet is simply used as a payment method.
Tax on the service is therefore applicable even when the customer pays using Wallet Balance.
The customer has:
Wallet Balance: $5,000
They purchase a service worth:
$100 + 18% Tax
The calculation is:
Service: $100
Tax: $18
Total: $118
The customer pays $118 from their Wallet Balance.
Remaining Wallet Balance:
$5,000 − $118 = $4,882
The tax paid when purchasing the Wallet does not cover tax on all future services.
The Wallet Balance is the value available to the customer, while tax is calculated separately based on the service or product purchased.
$1,000 paid → $5,000 Wallet Balance received → Tax is calculated separately on each taxable service purchased using the Wallet.