Managing taxes is an essential part of your business operations. You can effortlessly create and manage tax rates directly from HitPay Dshboard. HitPay’s fees are calculated from the total transaction amount, including taxes and tips.
Creating a Tax
Navigate to Settings > Tax Settings in your dashboard. Here, you can create a new tax by clicking the Add Tax 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 a Tax at Checkout
Only one tax can be applied to each order. You can learn more about applying taxes by following the guide here.
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.
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.
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.