Do you want to visibly reflect the tax rates you must pay as a business in the prices of your services or products? This guide will teach you to set, adjust, and assign them to services, and products. However, if you are not a VAT payer (you didn't fill in the VAT number in the Company details), you won't see the Tax rates tab and therefore you won't be able to set them.
How to create a new tax rate?
Open the Sales tab — Tax rates.
Click the blue + New Tax Rate button in the top right corner.
Then fill in all the necessary details:
Tax rate name — your customers won't see it anywhere, it's just for your reference.
Rate — this is the most important information. Enter a number here that will represent, in percentage, the tax rate you want to set.
Type — choose between added or deducted. You will learn the difference between the two below.
Confirm the addition of the new tax rate with the blue Save button.
What is the difference between added and deducted tax rates?
When selecting the type of tax rate you can choose between added and deducted tax rates, there is a significant difference between the two. They differ in how the tax rate is reflected in the price of the services. Below you find a detailed explanation:
Added tax rate
Added tax rate
If you select the added tax rate, the price of the service automatically increases by the set percentage.
In practice, your service costs €100 without the tax rate. You set the added tax rate at 20%. The price of the service therefore automatically adjusts and instead of the original €100, the service now costs €120 (€100 + 20%).
On your Booking Website, customers see that the service costs €100, the tax rate €20 and they pay €120 in total.
Deducted tax rate
Deducted tax rate
If you choose the tax rate deducted, the set prices remain the same. This option is great if you want to show customers the tax rate, but it doesn’t affect the total they pay.
For example, you have set the price of the service to €100. You choose a tax rate deduction of 20% for this service. The price of the service remains the same, i.e. €100, with the tax rate included.
On your Booking Website, customers see the total price of the service - €100. During checkout, they see the price broken down to service price - €83.33 and the tax rate of €16.67.
How to set the created tax rate as default?
The first newly created tax rate is automatically set as the default. It will be assigned to all services, and products offered.
However, if you want to use a different tax rate as the default, do the following:
Open the selected tax rate.
Click on the three dots in the top right corner.
Select Set as default.
ATTENTION: Take note when updating the default tax rate. If you are currently using tax rate A (for example 10%) and need to set tax rate B (for example 15%) as the default tax rate, create it and set it as the default through the three dots. From this point on, the system will see the default tax rate as B. However the services that had the original tax rate A assigned will not automatically be reassigned (so they will stay with the original rate A). The system will automatically apply the new default tax rate B only to newly created products, and services.
Do you need to set a different tax rate for some products, or services, than the default one?
In this case, you need to assign the tax rate to the selected product, or service manually.
Open the details of the selected product, or service.
Scroll down a little to see the Price & Taxes sign.
Place the cursor in the Tax rate box and select the type you want to apply to this product, or service.
Now just confirm this setting with the blue Save button.
How to adjust the tax rate?
If you want to edit the settings of the selected tax rate (for example, change its name or amount), do the following:
Open the Sales tab — Tax rates.
Select the tax rate you want to edit from the list of tax rates.
Tax rate details open, which you can easily overwrite or reconfigure.
When you are satisfied with the change, click the blue Save or Save Changes button.
How to delete the tax rate?
Open the Sales tab — Tax rates.
Select the tax rate you want to delete from the list of tax rates.
Click on the three dots in the top right corner.
Then select Delete tax rate level.
Confirm the deletion with the red Delete button.
Where can my customers see the tax rate?
Where can my customers see the tax rate?
Your customers will see the tax rate in the product order or when booking or paying for a service. They will see the price and the tax rate and of course the final amount. However, they will not see the specific tax rate name that you have set — this is just for your reference.
What if I don't set the tax rates?
What if I don't set the tax rates?
If you have a business in the European Union, you don’t have to worry. The tax rates are set automatically. However, there may be a problem with businesses outside of the European Union, as we don’t provide an automatic tax rate setup here.
In any case, any tax rate setup is the responsibility of the owner or manager of the business who manages the tax rates.