Note: when we use the term VAT, sales tax, or sales tax/VAT, it all means the same - value added tax or sales tax.
Salesbuildr supports multiple ways to calculate VAT. This article explains the different options and provides guidance on the best approach for your situation. This mostly depends on e.g. the country or region you're incorporated, how you do business (e.g. only local, or muti-national), and if you're serving customers exempt from paying taxes.
With the different Sales tax/VAT options available in Salesbuildr, you can accommodate any tax scenario wherever you are in the world or whatever business model you have.
Disclaimer 1:
If you are in doubt of which Sales Tax or VAT settings to apply, please consult with your tax advisor or CPA. Salesbuildr provides functionality to calculate Sales tax/VAT but will not provide advice, is not liable nor takes responsibility for the correct implementation and application of Sales tax and VAT in quotes or other data deriving from Salesbuildr.
Disclaimer 2:
Salesbuildr calculates Sales tax/VAT per line item. This is the method as used by most accounting platforms available today. In the case that your accounting platform calculates Sales tax/VAT per the subtotal of an invoice, this may result in rounding differences of 1 to 3 cents per invoice total. Such rounding differences should be seen as the result of the method of calculation. Therefore such differences cannot be considered a calculation error, or bug.
The hierarchy of the sales tax and VAT functionality in Salesbuildr in a nutshell:
Sales tax and VAT handling general setting
This can be found under [yoururl].salesbuildr.com/auth/profile/admin/tax-settings and shows these options:
Navigate to: Admin --> Sales Tax
Do not calculate Sales tax/VAT
Salesbuildr calculates Sales tax/VAT
Your PSA calculates Sales tax/VAT (applicable to Autotask only)
If you choose option 1, Salesbuildr does not calculate Sales tax/VAT - ever
If you choose option 2, Salesbuildr takes care of calculating the Sales tax/VAT values, based on the hierarchy set out below.
If you choose option 2, Salesbuildr applies Sales tax/VAT values returned by Autotask
Sales tax/VAT calculation hierarchy:
Categories level - overrides general Sales tax/VAT setting
In the product category/settings tab, you can override the default Sales tax/VAT setting.
Navigate to Categories --> (Edit with pencil icon) --> Settings
Product type level - overrides general setting and categories Sales tax/VAT setting
This can be found under [yoururl].salesbuildr.com/auth/profile/admin/product.
Navigate to Admin --> Products
You can configure the default Sales tax/VAT rate that applies to each product type based on the product types available in your tenant. With this feature, it's easy to e.g. mark services as non-taxable, and products as taxable without having to dive into each of those products to configure this.
Companies level - overrides general setting, categories setting, and product type Sales tax/VAT setting
This can be found in the admin section of the Company properties.
Navigate to Company --> Edit --> Admin
Each customer is configured to use the tenant and/or product and/or category default tax rate. Based on e.g. location, you can manually update the applicable Sales Tax/VAT rate. Or, when a Sales tax/VAT number is present, you can mark a customer as 'tax-exempt'.