Checkout Tax Rates

Getting Started
Creating a Single-Rate Sales Tax
Creating a Multi-Rate Sales Tax
Shipping Products and Sales Tax
Managing and Editing Taxes

Getting Started with Taxes

Taxes are the first things that you shoud set up when creating your Checkout store. That way, as you create new products, you can automatically have the appropriate taxes assigned to them. Unless you have a specific reason to do so you should NOT setup any Tax Regions. Once created Tax Regions cannot be removed and should only be used if necessary.

Create a Single-rate Sales Tax

Single tax rates are the most common tax rates and the simplest ones to set up. You would set up a Single-rate Sales Tax if you only needed to charge a state sales tax.

1. Open the Manager > Taxes window
   
2. Click the '+' button in the left-hand Groups pane
   
3. Add the Group Tax name
   
4. With that name highlighted, click the '+' button in the right-hand pane
   
5. Add a Tax name and rate
   
6. Place a check mark in the box indicating this rate should be applied to new products when they are added (if appropriate)
   
7. Indicate how this Group should be used (Sales, Purchases, All)
   

You can use the above single-rate steps to create several tax groups that can be applied to various Products (different Tax Group of rates for different products).

On invoices, products will be taxed at the Tax Group rate, while the Tax report will show the sales tax collected for the tax authority.

To Implement the above Tax Groups

If you chose not to apply the tax to all products upon creation or you've created your products before creating your taxes you can add the tax to each product individually. In the Manager > Products > Pricing window, select the Tax Group that applies to the Product

Create a Multi-rate Sales Tax

To create a multi-rate sales tax for two or more tax authorities (for example a state and a city sales tax)

1. Open the Manager > Taxes window
2. Click the '+' button in the left-hand Groups pane
3. Add the Group Tax name (perhaps something such as store tax)
4. With that name highlighted, click the '+' button in the right-hand pane
5. Add a Tax name and rate for each tax authority (for example, one for state, one for city)
6. The rates will be added together when applied to sales and purchases
7. Place a check mark in the box indicating this rate should be applied to new products when they are added (if appropriate)
8. Indicate how this Group should be used (Sales, Purchases, All)

Implement the above Tax Groups

If you chose not to apply the tax to all products upon creation or you've created your products before creating your taxes you can add the tax to each product individually. In the Manager > Products > Pricing window, select the Tax Group that applies to the Product

You can use the above steps to create several tax groups that can be applied to various Products (different Tax Group of rates for different products).

On invoices, products will be taxed at the Tax Group rate, which will be the sum of all the rates associated with the Group. The Tax report will show the sales tax collected for each tax authority (each rate), while the invoice will show the total sales tax collected.

Shipping Products and Sales Tax

If you need to collect different taxes based on where you are shipping products to you need to set up Tax Regions. Tax Regions should only be set up if necessary for your business.

Shipping cannot be directly set up a new sale. To be able to use shipping and the associated Tax Region you need to first create a quote or order and then convert this into an invoice.

To Set Up Tax Regions:

1. Open the Manager > Taxes
2. Click the Tax Regions tab
3. Click the '+' button to create a new Region
4. Indicate its name and code
5. If appropriate, add Sub-Regions, indicating the names and codes. The sales tax in sub-regions will be the sum of the sub-region plus the parent regions
6. If appropriate, indicate the Default Tax Region

Once the tax region is created you need to set up the taxes that will be associated with the region and apply the region to them.

To Apply Tax Regions:

1. Click on the Groups & Rates tab
   
2. Create the single-rate Tax Groups and Rates sales taxes as indicated in Create a Single-rate Sales Tax
   
3. You can group similar taxes into Tax Groups, that is state taxes into a state group, city taxes into a city group, etc. The Tax Rates within Tax Groups provide the tax rates for Regions and Sub-regions
   
4. Select the Tax Group
   
5. In the right-hand pane, associate the Tax Rate with the Region
   

To implement Tax Regions

• In the Manager > Products > Pricing window, select the Tax Group that applies to the Product
• On Customer cards, click the Shipping Info dropdown menu
• Select the Tax Region that applies to the customer

The Tax report will show the sales tax collected for each tax authority

Managing Checkout Tax

Editing a Tax Group or Rate

To edit a tax code, simply click on an existing entry in the list. From here, you can assign a new name to a group, and change the name or rate of a tax rate. If you change a existing tax code to be a default or remove it from being a default, previously created Products will not be modified. If you change a tax's percentage, any saved Orders will be updated.

Deleting a Tax Group or Rate

Should you ever need to delete a tax group or code, open the Manager Window and select the Taxes option from there. Select the code you wish to delete by clicking on it to highlight it, and then, in the bottom-left corner of its panel, click on the minus (-) sign. This will remove the tax from your list. Any orders that are in the system will be updated to reflect the deletion of the tax code. Invoices, however, remain unchanged.