Users can choose to make Expenses, Invoices. Estimates and Credit Notes inclusive or exclusive of tax.
The tables below display how Discount, amount before tax, tax amount and total amount are effected based on this tax setting, as well as the calculations used to come up with the amounts.
Sample Data Used
Quantity (Qty) = 1
Unit Price = $100 USD
Discount % = 5%
Tax % = 10%
Tax Exclusive
Tax Exclusive means tax is applied on top of the unit price.
Field | Amount | Formula |
Discount Amount (5%) | 5 | (Discount %) x (Unit Price x Qty) |
Amount Before Tax | 95 | Qty x (Unit Price – Discount Amount) |
Tax Amount (10%) | 9.5 | Qty x ((Unit Price -Discount Amount) x (Tax %)) |
Total Amount | 104.5 | Tax amount + Amount before tax |
Tax Inclusive
Tax Inclusive means the unit price includes tax.
Field | Amount | Formula |
Discount Amount (5%) | 5 | (Discount %) x (Unit Price) x Qty |
Amount Before Tax | 86.36 | Qty x ((Unit Price – Discount Amount) / (1+ Tax %)) |
Tax Amount (10%) | 8.64 | Qty x [(Unit Price – Discount Amount) – (Unit Price – Discount Amount / (1+ Tax %))] |
Total Amount | 95 | Tax amount + Amount before tax |
Do you need any further help understanding how Tax being inclusive or exclusive effects your financial transactions? Contact our support team via chat or email.