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Tax Code — Edit

When configuring tax codes in Manager.io, several fields need to be completed to ensure accurate tax calculations and reporting. This guide explains each field and how to properly set up your tax codes.

Name

Enter the name of the tax code in the Name field. This name will appear in dropdown menus and on printed documents such as invoices and receipts.

Label

If you prefer the tax code to display differently on printed documents than it does internally, enter an alternative name in the Label field. If you want the internal name to be visible to customers and suppliers, you can leave the Label field blank.

Tax Rate

In the Tax Rate dropdown box, you have three options:

  • Zero Rate: A simple tax code with a rate of 0%. It does not require a tax account or additional setup.
  • Total Rate: Allocates 100% of a transaction's amount to a tax account. This is typically used by importers who are not directly charged tax by the seller but receive a separate invoice from the tax authority. Use the Total Rate tax code when you need the full amount of a transaction to go into a tax code.
  • Custom Rate: Allows you to define your own tax rate. After selecting Custom Rate, you can choose between Single Rate or Multiple Rates.

Type

In the Type dropdown box, select one of the following:

  • Single Rate: Enter a single tax percentage in the Rate field.
  • Multiple Rates: Create a complex tax code that includes two or more tax components, each with its own name and percentage rate.

Account

For Total Rate and Custom Rate tax codes, you must select an Account:

  • The default account is Tax Payable, which acts as a temporary account to collect tax amounts from transactions using the tax code.
  • To settle the tax you owe or to claim a tax refund, you need to choose the appropriate account manually within a specific transaction.
  • Since you cannot select the placeholder Tax Payable account for these actions, you should create a personalized tax account in the Chart of Accounts.
  • After creating the new account, select it in the Account field when modifying your tax code.

By carefully configuring each of these fields, you ensure that your tax codes function correctly, leading to accurate financial records and compliance with tax regulations.