Tax groups

A tax group is what an item and a document line are taxed under. It names one or more tax codes, and every code in it is charged together. Most groups hold a single code, such as Standard rated or Export; a group with two codes charges both on the same line.

Build a tax group

1. Go to Tax ‣ Configuration ‣ Tax groups and click New tax group.
2. Fill in Code, Name and Description.
3. Under Tax codes in this group, click Add tax code and pick the Tax code. Add a row for each code the group charges.
4. Click Save.

The group’s Total rate shows what it adds to a price in all, as a percentage, with every code counted.

Field	What it sets
Tax codes in this group	The codes charged together on a line. Each code can appear once.
Compound	Tax-on-tax: this rate applies on top of the non-compound rates in the group.
Subsidiary	Restrict the group to one subsidiary. Leave it blank to share it with all.
Active	Inactive groups are hidden from new documents. An active group must charge at least one code.

Note

A group only charges the codes that apply where and how it is used: codes whose authority covers the subsidiary’s country, and that apply to the side of the trade on the document. A group that holds a code for each of two countries can serve both.

Charge one tax on top of another

Some taxes are charged on the price plus another tax. Put both codes in one group and switch on Compound for the tax charged last, so its base includes the other.

Example

A drinks distributor sells an energy drink that carries 50% excise, with 15% VAT charged on the price plus the excise. Its DRINKS group holds the excise code and the VAT code, with Compound on for VAT. A can at 10.00 is charged 5.00 excise and 2.25 VAT, 17.25 in all, and the group’s Total rate shows 72.5%.

Give an item its tax group

Every item names the group it is taxed under, and each document line takes it from the item.

1. Go to Inventory ‣ Master data ‣ Items and open the item.
2. On the Costing & tax tab, pick the Tax group.
3. Click Save.

An untaxed item takes a zero-rated, exempt or out-of-scope group rather than none: a line with no tax group cannot be priced. See Items for the rest of the item.

Tip

To tax one line differently, such as a single export sale of an item you normally sell taxed, pick another group in the line’s Tax group column instead of changing the item. See How tax is worked out.

Archive a tax group

Archive a group you no longer use; documents already taxed under it keep it. Move every item to another group first. Open the group and click Archive; Restore brings it back, provided none of its codes is archived.

Messages you may meet

Message	What to do
An active tax group has to charge at least one tax code. Add a code, or turn the group off.	Add a row under Tax codes in this group, or switch Active off.
A tax code appears twice in this group; each one belongs to it once.	Remove the second row.
A tax group with this code already exists; archiving one does not release its code.	Use another Code, or restore the archived group.
Items are still taxed under this group; move them to another before archiving it.	Give those items another Tax group, then archive.
This group charges an archived tax code; restore the code or take it out of the group before restoring the group.	Restore the code, or remove it from the group.
The tax group is archived; restore it before editing it.	Click Restore, then make your change.