Overview
Create a Tax Structure to apply a tax rate to an item. Items may only have one Tax Structure applied to them, the default rate for the enterprise for a tax structure is established here, Rates for tax structures can be overridden at a venue or store level .
link for information on: Tax Exempt Sales
DETAILS
Each Tax Structure must have its own unique Structure Name. This will show up in all reports and tax filters so you should name them carefully. If you try to create a tax structure with an existing name a popup will displayed asking you to confirm this activity. It is not advisable to create structures with the same name. This will lead to much confusion when reviewing reports.
Each structure can support two rates if necessary. In Percentage 1, enter the applicable percentage rate for the first rate that will be charged. In Percentage 2, enter the applicable percentage rate for the second rate that will be charged; otherwise it can be left blank.
If the rate on percentage 2 is to be charged on the Amount plus the tax in percentage 1 , then check the Compoundedbox; otherwise it should be left blank.
In some instances tax structures are only applicable if the item is priced above a certain amount, if that is the case enter the Minimum Taxable Amount on which the tax structure should apply. The tax is applied to the full item price. If the price of any items associated with this structure is below the minimum amount, no tax will be applied. Tax structures do not consider any minimum transactional amounts only minimum item amounts. The minimum taxable amount can be applied to both Percent 1 and Percent 2.
Example of minimum tax: Percentage 1 is 10% and "Apply Tax1 if over this amount" is $50. The item sells for $200. $200 is taxable at 10% - tax will be $20 (as the item sells for over $50).
You can also select the tax to be applied to "over amount" or "under amount" instead of the full amount.
The tax percentage can be applied to only the amount that is above the amount entered. If the tax rate is 10% and the apply to tax amount is $50.00. If the item is sold for $120.00 the 10% is only applied to $70.00, tax is $7.00
Or
The tax percentage can be applied to only the amount that is under the amount entered. If the tax rate is 10% and the apply to tax amount is $50.00. if the item is sold for $120.00 the 10% is only applied to $50.00, tax is $5.00.
Click on Save to create the Tax Structure.
Short Term Tax Rate Change
If a company has a tax free weekend or certain items are tax free, they can change certain items to be free of taxes. In order to do this, the user must Create a new tax structure with the rules of the incentive, including price benchmarks and tax rates. Move the effected items into the new structure using the mass modify at a classification level. If not in one category, then you will have to manually update the items.
Access
Access to this function at an enterprise level is limited by default to the System Administrator and Financial users only. Accounting, store managers and warehouse general managers may modify tax code settings at Venues or Store assigned to them.