Set up sales tax

Track and Invoice adds the rate you enter. It does not decide which rate you should charge. Check with a tax professional about what to charge.

1. On a client, set Sales Tax Rate (%). The note says it is applied to this client's taxable items. A new invoice for that client starts with this rate. A new item starts with it too, until you type a different rate. The note on the item says Using Client's default sales tax rate. Edit to override.
2. On New Invoice or Edit Invoice, set Sales Tax Rate (%). The info note says this rate applies only to line items marked Taxable, and you can override the rate for taxable lines on this invoice.
3. On a line, turn on Taxable, then set Sales Tax Rate (%) if this line should use its own rate. That line rate is kept when you later change the invoice rate.
4. On a quote, set Tax Rate % (optional). It works the same way for the quote's taxable lines.
5. A recurring series has its own Sales Tax Rate (%). Each invoice it creates uses that rate.

When more than one rate is set, the line rate wins for that line. If the line does not have its own rate, the invoice rate is used. On a quote, the quote rate is used the same way. The client rate is the starting value for a new invoice or a new item. It does not replace a rate you already saved on a line.

On the invoice, the lines add up to Invoice Subtotal. Tax is a row under that. If every taxed line uses the same rate, the row is Sales tax plus that rate, such as Sales tax (9.375%). If the lines use different rates, the row says Sales tax. A zero tax amount is left off the invoice. Each section can also show its own subtotal, such as Goods Subtotal.

Related guides

• Which lines are taxed
• Add a client
• Add an item
• Create and send an invoice