Taxes are part of doing business, no matter the industry. They are one of the most important things in your finances, which is why efficiently managing them is crucial. One way to do it is by adding them directly to your products or invoices, which helps you stay organized, remain compliant, and make sure your finances are in order.
How to Manage Taxes #
You can manage your taxes by adding them to products or invoices directly, keeping a record to follow with every sale. How to add them depends on the type of tax you need to add, but to start, go to the Settings tab inside the Payments section and select the Taxes option to your left.
Include Tax in Prices #
You can specify whether product prices are tax-inclusive or tax-exclusive to ensure the right tax convention is followed. This setting can be applied to all products within this section. If no selection is made, Tax Exclusive is the default setting.
Manual Taxes #
This gives you the option to create taxes on non-standardized products or businesses outside the US. To do so, click on +Add Tax. A pop-up window will open for you to add the tax information—you need to add the name and percentage for the tax, and you can also add any extra information. Once completely filled out, click Add to save it to your system.
Automatic Taxes #
This feature automatically calculates sales tax based on the customer’s address and is designed for businesses inside the US. To add them, first toggle Enable automatic sales tax, then select the category of your product for the tax percentage. Then select the states you do business with, check the box to accept the Terms of Use, and click Save.
Adding Taxes to Invoices #
Once your taxes have been created, you can start adding them to your invoices by clicking on Add Tax to add manual taxes or toggling automatic taxes within the invoice builder. Adding them this way will tax all products in the invoice.
Note: Automatic taxes require contact information for the country, state, and postal code.
To add taxes to a specific product, click the Add Tax button associated with the product. This will open a menu for you to select from your added taxes. Adding tax manually allows you to add different tax rates for each product, while automatic taxes are applied to the entire invoice. Once you do, click save to set it.
To apply taxes to all products listed in the invoice, click the Add Tax button located below the subtotal section. Configure the tax details accordingly, and then save your changes.
Complete your invoice as usual, and you’re all set. With taxes now tracked directly in your account, you can reduce the administrative burden for both you and your accountant.
Important Notes #
Existing products are by default set to the global tax settings but can be changed for different products to have independent tax settings. New products will also follow global settings, but this can be adjusted as needed during or after creation. This flexibility allows you to manage tax preferences in a way that suits your business’s needs.
Frequently Asked Questions #
Where do I set up taxes in the CRM? #
Go to the Settings tab inside the Payments section and select the Taxes option to create manual or automatic taxes.
What is the difference between manual and automatic taxes? #
Manual taxes let you define a name and percentage for any product or non-US business, while automatic taxes calculate US sales tax based on the customer’s address.
What information is required for automatic taxes to work? #
Automatic taxes require the contact’s country, state, and postal code so the system can calculate the correct rate.
Can I apply a different tax rate to individual products? #
Yes. Click the Add Tax button on a specific product to apply a manual tax rate to just that item, while automatic taxes apply to the entire invoice.
Are product prices tax-inclusive or tax-exclusive by default? #
If no selection is made, prices default to Tax Exclusive, but you can switch products to tax-inclusive in the tax settings.
Do new products automatically follow my global tax settings? #
Yes. Both existing and new products follow the global tax settings by default, and you can adjust individual products to use independent tax settings.
