Taxes
Set up the taxes you charge once, then pick them on any Invoice or estimate. Go to Settings › Taxes.
Add a Tax Rate
Section titled “Add a Tax Rate”- Under Tax Rates, enter a Name, like CA Sales Tax or VAT.
- Enter the Rate (%), like 8.25.
- Optional: turn on Compound or Make default for this workspace. Both are explained below.
- Click Add Tax Rate.
Add as many as you need. Your Clients see the name on their Invoice, so make it clear.
Set a Default Rate
Section titled “Set a Default Rate”Your default rate is added to every new Invoice and estimate on its own. You can still change the taxes on each one.
To make a rate the default, click the star next to it. Click the star again to turn it off.
Which Default Wins
Section titled “Which Default Wins”When you create an Invoice or estimate, hrglass picks its taxes in this order:
- The Project’s Default Tax Rates, if it has any.
- The Client’s Default Tax Rates, if they have any.
- Your workspace default.
See Creating a Project and Adding a Client.
Compound Tax
Section titled “Compound Tax”Some places charge one tax on top of another. A compound tax is worked out on your subtotal plus the taxes before it, not just the subtotal.
Example on a $100 Invoice with a 5% tax and a 10% compound tax:
| Line | Amount |
|---|---|
| Subtotal | $100.00 |
| Tax (5%) | $5.00 |
| Compound tax (10% of $105) | $10.50 |
| Total | $115.50 |
Without compound, the second tax would be $10.00 and the total $115.00.
Prices Include Tax
Section titled “Prices Include Tax”Under Pricing Model, the Prices include tax switch decides how tax and your prices fit together.
- Off: tax is added on top. A $100 line with 10% tax comes to $110. Most US businesses use this.
- On: your prices already include tax. A $100 line with 10% tax stays $100, and hrglass shows the $9.09 of tax inside it. Common in the UK, EU and Australia.
It applies when you create or edit an Invoice or estimate. Pick one before you start billing and stick with it.
Edit or Delete a Tax Rate
Section titled “Edit or Delete a Tax Rate”- Edit: click the pencil icon, change the name, rate or Compound, then click the check mark.
- Delete: click the trash icon and confirm.
Invoices and estimates you already made keep the tax they had. Deleting a rate just removes it from the list for new ones.