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Back Office Tax Categories

January 23, 2024

Description

How to add, edit and remove a tax category in the Back Office

What's in this article?

Configure as many tax categories as necessary for the items you sell, and designate a specific tax category to use as the default while creating a new item. Otherwise, the system defaults the tax category to a 'No Tax' category. 

The taxes that apply to your business may vary depending on the type of items you sell. For example, you might create a tax category called Food Tax and assign it to food items, such as hamburgers and fries. You might create another tax category called Alcohol and assign it to your alcoholic beverages, such as beer and wine. When you create a guest check for a hamburger, fries, and a beer, the system calculates the applicable tax based on the tax rate associated with the tax category assigned to each item.

NOTE:
By default, your store already has a No Tax tax category for use with tax-exempt items. 

Add a tax category

NOTE: Essentials Light supports a maximum of two tax categories.

  1. In the Back Office, select Settings at the top-right corner of the screen.
  2. Select Taxes.
  3. Click Add a Tax Category.

    screen in the Back Office to add a tax category
  4. Enter a descriptive name and select whether the new category will be the default or an inclusive tax.
    • Make this an inclusive tax combines the tax amount and the item price to show one total as opposed to tax amount and item amount; however, your reporting will still show separate totals.

      NOTE: Including the tax amount in the purchase price, also known as an "inclusive tax", is an available option for all POS solutions except Essentials Light. For Essentials and Retail, the default or "first" tax category may not be designated as inclusive, but additional tax categories can be. Restaurant Solution allows any tax, including the default tax, to be an inclusive tax. 

    • Make this my default Tax Category indicates that this tax category is your default tax rate. When you create a new item, the system will apply this tax rate by default.

      screen to assign a tax category a name and select whether it should be a default or inclusive tax
  5. Click Done.
  6. Enter the tax rate percentage that applies to the items in the tax category (such as 3.250). 
    • If you have multiple selling locations, you will need to enter the tax rate for each selling location. 
    • If your selling location requires a tax jurisdiction breakdown, you can edit the tax location name to add jurisdictions. For example, you may want city, state, and county jurisdiction breakdown for reporting.
  7. Click Save. If your merchandise requires multiple tax categories, repeat this process for every tax category you need to create.
Edit an existing tax category
  1. In the Back Office, select Settings at the top-right corner of the screen.
  2. Select Taxes.
  3. Edit the tax rate or the tax category name as needed.
  4. Click Done to save your changes.
Remove a tax category

Removing a tax category is a "soft delete". This means that although the tax category is removed from your view, all the data and activity associated with that tax category is still shown in reports, transactions, etc.

  1. In the Back Office, select Settings at the top-right corner of the screen.
  2. Select Taxes.
  3. Click on the name of the tax category you want to delete.
  4. Click Delete to delete the tax category. The Delete option will only be enabled if there are no items assigned to this tax category. 
  5. Click Yes to confirm the removal. If the selected tax category has any sales activity, the system will alert you so that you can determine if you still want to remove the tax category.
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