Disclaimer: This guide to Tradify is for reference only and not official financial or tax advice. Tradify is not liable for decisions based on this information. Please consult your bookkeeper or accountant.
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Learn more about how your tax obligations influence your workflows in Tradify and how to process financial documents based on your tax situation.
Note: This article explains GST, but similar processes may apply to other taxes. Tradify advises consulting a qualified professional or your bookkeeper for specific questions.
Understanding Tradify and GST (or international tax systems)
If you're looking for more information on Tradify's tax settings, check out Understanding Tax Settings In Tradify.
Tradify allows you the option to either exclude or include GST/VAT/Tax on your price list items. The general guidelines are:
- If you are GST registered, exclude GST from your costs.
- If you are not GST registered, include GST in your costs.
You will see a prompt for this when adding a Price List Item.
Excluding GST from your sell price
If you're GST registered, exclude GST from your buy and sell costs when adding a Price List Item. The markup will automatically apply when pulling items through to invoices.
The line item in both the invoice and the Price List Item modal will show as exclusive but you can see the total in the grey total box.
If you add a markup to your selling price, you're on charging the GST cost to your customer. Your buy cost will pull through and you can either add a Pricing Level or a manual markup to amend your price for GST.
Including GST in your costs
If you're not registered, include GST in your costs and select No Tax in the upper corner of the Invoice Line Items display.
The difference between Inclusive and Exclusive Tax
Inclusive tax: when using inclusive tax, the tax value is worked out to be included within the current total value of the sell price.
Breakdown: If an item is $100 tax inclusive at a rate of 10% tax, this means that this item contains both the sell value ($90.91) and tax value ($9.09) within the $100 item total.
Calculation: 90.91 + 9.09 (10% tax) = $100
Exclusive Tax: when using Exclusive tax, the tax value is added on top of the items current sell price.
Breakdown: If an item is $100 tax exclusive at a rate of 10% tax, this means that the item does not contain the tax value (10%) within the item sell price.
Calculation: 100 + 10 (10% tax) = $110
Additional Information
For more info on Tradify's tax settings, see here: 🎬 Tax Settings
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