You can set up taxes in the system if the services you provide are taxable. Taxes are dependent on three things:
- Create a tax rate for the company - On the left navigation bar click on Settings and then under Business click on Tax. On the top right you can click on + Create Tax to add a new tax value.
- Assign the tax to a customer in the customer profile - On the left navigation bar click on Customers. Then from the customer list, click on the name of the customer where you want to turn on tax. Go to the Profile tab and scroll down. You will see Tax here. You can select the tax value to be applied for this customer.
- The service needs to be taxable - On the left navigation bar click on Settings and then under Services, click on Service List. Here click on the service name that you want to make taxable. Then scroll down to Additional section. Select taxable and then click save at the bottom.
These three factors give you complete control on collecting the applicable taxes. You can define multiple tax rates if you clients are in different tax jurisdictions. Keep in mind that a customer can only be assigned one tax rate at a time.
When you create an invoice you can select the services and then on the top click on Tax & Discounts to see the tax applied.