Understanding Tax Settings In Tradify

Tax Settings offer you the ability to create new tax rates, amend existing rates and adjust any presets that are of relevance to your company.

Tax rates are used to calculate sales and purchase taxes on Invoices, Quotes, Purchase Orders and Bills. In most cases, you will only need one tax rate for each option, however, if your country or tax jurisdiction requires multiple tax rates when invoicing, you can add additional tax rates to accommodate this.

Important Note: Tradify doesn't have the ability to group tax rates together. For this reason, Tradify may not suitable for use if this is a requirement in your region.

Please note that this is not official financial advice and should only be taken as a guide to using Tradify. Tradify accepts no responsibility for any decisions users make regarding their own tax obligations.

Tax Settings

To access your Tax Settings, head over to Settings and select Tax Settings. Within this page, the following options will be available to edit:

Default Tax Rate – used as the default tax rate for new Price List Items, Billing Rates and Miscellaneous costs.

Default No Tax Rate – used as the default "no tax" rate for new Price List Items, Billing Rates and Miscellaneous costs.

Sales Tax Default - this acts as the master tax setting for any new customers. Any customers created before you change these settings will need to have their settings updated in their customer profile if you want to update existing customer profiles. 

Purchase Tax Default - the default purchase tax calculation indicator that applies to new Suppliers.

Tax Calculation Method – this determines whether your tax is calculated on each line item or on the whole document (for invoices or quotes).

Note: If you're integrated with an accounting system, it's recommended that you use the same calculation method. If you don't, you'll likely have discrepancies in your tax amounts. 

Adding a new Tax Rate

To create a new Tax Rate, head over to Settings, select Tax Settings, then select "New Tax Rate". Next, enter a name in the Display Name field and a tax rate percentage in the Rate field. Once you've added these details, click "Save" to finalise your changes.

Deleting a Tax Rate

To delete a Tax Rate, head over to Settings, click on Tax Settings and then select the X icon on the right-hand side of the rate you wish to delete. 

Note: Tax Rates cannot be deleted if they have already been used on a Quote, Job, Invoice, Purchase order, Bill, or if it's assigned as a default tax rate on any Billing Rate and/or Price List Item. For this reason, it's recommended to use the "archive" function (covered in the following section). 

Archiving a Tax Rate

Archiving a Tax Rate will subsequently remove it from being used or seen throughout Tradify. You will still have visibility of it within Settings and also within historical records, but it won't show as an option anywhere else.

To archive an existing Tax Rate, head over to Settings and select Tax Settings. Next, click on the relevant tax rate and then select "Archive this tax rate", followed by "Save".