Taxes
Managing Tax Rates on HitPay POS
Overview
Managing taxes is an essential part of your business operations. With HitPay POS, you can effortlessly create and manage tax rates directly from the mobile app. HitPay’s fees are calculated from the total transaction amount, including taxes and tips.
Creating a Tax
Open the HitPay app and navigate to the Tools tab. Click on Taxes to access the tax settings page. Here, you can create a new tax by clicking the + button.
Enter the necessary tax details:
- Tax name
- Tax rate
- Specify whether the tax is inclusive or exclusive of the total amount or product pricing.
Your newly created tax rates will be listed under the tax settings page.
Applying an Automatic Default Tax at Checkout
Under the tax settings page, you’ll find a Choose Tax Default button. By default, it’s set to None. Click the right-hand arrow to choose a Tax Default. You’ll see a list of tax options. Select a tax that should be automatically applied at checkout.
Applying a Tax at Checkout
While using the HitPay app in Point of Sale mode, create a Quick Sale or Products charge. After clicking Charge or Go to Cart, you’ll be taken to the Cart page.
If none of the available taxes are set to be applied to checkout by default, you can click the More actions button to reveal a dropdown menu and select Add Tax. If you’ve previously created taxes, you’ll see a list of available taxes. Otherwise, you’ll be prompted to create a new tax. You can swipe left on an existing tax to edit its details.
To apply a tax, select a tax option and click Apply.
Tax-Inclusive vs Tax-Exclusive Tax
The choice between Tax-Inclusive and Tax-Exclusive Tax impacts how taxes are calculated in relation to the final transaction amount.
Tax-Exclusive Tax
A Tax-Exclusive Tax is added to the Total Amount at the point of the final transaction. Example: You may charge #100 for a service and add a 7% GST tax. Adding a Tax-Exclusive GST tax adds an additional #7 at the point of purchase. The Total Amount becomes #107.00.
Tax-Inclusive Tax
A Tax-Inclusive Tax is already included in the price of purchase. Example: You may charge #100 for a service with 7% GST included as a Tax-Inclusive Tax. The Total Amount remains #100.
Understanding the difference between these tax types helps you make informed decisions when configuring your tax rates in the HitPay app.