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See also: Taxes and Contractor Tax
The Inventory Details window - Taxes tab has many options regarding taxes. In the example below, the taxes are broken out into city tax and state tax. In some states, provinces, or countries there is only one tax or no tax. In others, there could be a variety of taxes.
Some tab functions work in relation to the window's Toolbar. Click Toolbar to view detailed information about the Toolbar button options.
These taxes should be setup in the Tax Setup area of the software under the Setup Wizard and then on each individual item you can specify which taxes apply. Note that if a tax is set, it is automatically set on the invoice unless the customer is exempt, and that cancels the tax. However, in either case, you can override the automatic tax setting on the invoice and charge the correct tax.
Tax Setup in Setup Wizard:
Customer Tax Setup:
Note: If you are in a state such as California with different tax rates in every county, the software can automatically set the tax rate based on the county you have the customer set to. You should only use this tax option if you are shipping the goods to the different counties. If you sell retail out of the store, then it's much easier. System Five reports on the sales and the taxes collected for each tax zone for your end of month reports.
In Canada, most provinces have two taxes, the Provincial Sales tax and the GST (Goods and Services Tax). Note that if you sell into Atlantic Canada and also the rest of Canada you must charge the HST into the east coast at 15% and the GST at 7% everywhere else. Normally tax 2 should be set to be the GST/HST.
In other countries that use the GST or VAT tax systems, use tax 2 and ignore the other tax settings.
System Five also allows for the setting of Tire tax, battery tax or oil change tax which are based on per unit instead of a percentage of retail. As governments have found that the environment is a good source of funds, expect to see more taxes. In British Columbia, the bottle deposit, container levies and paint recycling fees are quite complex. Once the tax rates have been set in the tax table, turn on the appropriate taxes for the item.
For example, we apply a glass tax of $0.20 to a 2 liter soda product:
See also: Inventory Details window