This article is to help you set up taxes for your shop and understand how they work. If you’re not sure about your tax rate or what needs to be taxed, we recommend checking with an accountant or bookkeeper.
To set up taxes, go to Settings > General and scroll down to the Fees & Rates section. Enter the tax rate for your area. Then below the tax rate, select if taxes should be applied to Parts, Labor, EPA, Shop Supplies, and Subcontract. Then save the setting. For information on Shop Supplies and EPA check out our general settings video.
Note: These tax settings will be applied to each new service created on an estimate. If there are any previous services created they will use the tax rate that was set at the time of creation. The tax rate will be displayed at the bottom of the service.
You can manually change the tax for a service by clicking on the tax rate, making any change to the rate, and clicking the check icon to save. This manual change will only apply to this service.
To make a customer tax-exempt go to the Customer List and select the customer. In the ellipsis in the top right click Edit Customer. From the customer information click Show More, and scroll to the bottom. Click the Is this customer tax-exempt toggle so it is turned on. Then click Save to make the customer tax-exempt. You can also take these steps to make a Fleet tax exempt.
When the tax-exempt customer is added to an estimate no taxes will be applied even if they have been set up in your General Settings.
When you add a tax-exempt customer to an estimate with taxable items a message will appear. Click Apply to remove all taxes from services on the estimate. Clicking No Thanks will keep taxes for services on the estimate.
Items on a Service
When adding an item to a service it will be taxed based on your General Settings. You can make the item non-taxable by clicking on the item and scrolling to the bottom of the details in the right-side panel. Click the toggle off for Should this be taxed and click Save. With the toggle off no tax will be applied to this item even if taxes have been set up in your General Settings.
Parts and Labor from your Inventory that are added to services will also be taxed based on your General Settings. You can make them non-taxable. Find the Part or Labor item in your Inventory and click the ellipsis on the right. From the information page, scroll to the bottom and click the toggle to turn off Should this be taxed? Now when this Part or Labor item is added to a service tax will not be applied to it even if taxes have been set up in your General Settings.
Taxes can be set individually for a Canned Service. From the Canned Services List select the service you want to edit. Click on the tax rate at the bottom of the service, make any change, and click the checkmark to set the taxes. Then click Save & Close. When this Canned Service is added to an estimate it will use the taxes set for this specific service instead of the taxes that have been set up in your General Settings.
Taxes will show up in your Shopmonkey Reports. They can be found by navigating to the Reports tab from the left side navigation, and can all be adjusted to view data from a specified time period:
The Sales Tax Report will show you Taxable, Non-Taxable, and Tax-Exempt totals by Item like Parts, Labor, Fees, and others.
Tax can also be found for all estimates and all invoices in their respective reports.
Still have questions? Feel free to reach out to us through the Chat Icon in the bottom right corner of your screen. Thanks for reading!