This article is to help you set up taxes for your shop and understand how they work. If you aren’t sure about your tax rate or what needs to be taxed, we recommend checking with an accountant or bookkeeper.

Select the Settings icon in the bottom left corner of your screen.

Select General Settings under the Settings section on the left-hand side.

In the Fees & Taxes section, set your shop tax rate and choose which items should include tax (parts, labor, EPA, shop supplies, subcontract).

Please Note: If you are a Canadian-based shop, your tax settings will look a little different including settings for GST, PST, and HST.

When you edit customer info and preferences, toggle on “Is this customer tax exempt?” if the customer is exempt from taxes. No taxes will be applied when the tax-exempt customer is added to an estimate.

For orders with a tax-exempt customer: In reports, taxable items that match the shop tax settings will be returned as tax-exempt. Taxable items that are non-taxable in shop tax settings will be returned as taxable.

When you add a line item to a service, it will be taxed based on the tax settings you chose in your general settings. To change whether or not an item is taxable, select the line item and toggle on/off Taxable on the right-side panel.

Please Note: The tax toggle on line items works the same for both taxable customers and tax-exempt customers. When editing the order tax settings, the tax toggle on line items also works the same for both types of customers.

Parts and labor from your inventory that are added to services will also be taxed based on the tax settings you chose in your general settings.

To make an inventory item non-taxable, find the item in your inventory. Select the … ellipsis to Edit the inventory item.

Scroll down and toggle off Taxable. When toggled off, this inventory item will not be taxed when added to a service even if taxes have been set in your general settings. Select Save.

Please Note: If a line item is taxable, leave the tax toggle enabled regardless of the customer's tax status. When editing the order tax settings, there will be a yellow banner describing how 'enabled' vs 'disabled' tax toggles will affect the order and reports.

Still have questions? Feel free to reach out to us through the chat icon. Thanks for reading!