VAT Categories
Define tax rate categories applied to products and bookings.
VAT categories define the tax rates you apply to products and bookings. Each category has a name, a percentage rate, and a code for accounting purposes. You assign a VAT category to each product in your inventory, and the rate is used when calculating prices and generating invoices.
How It Works
You create VAT categories for each tax rate your business needs (e.g., "Standard 24%", "Reduced 11%", "Zero-rated 0%"). One category is marked as the default, which is automatically applied when you create new bookings and new inventory products. The VAT percentage is used when calculating booking totals and appears as a separate line on invoices so your customers can see exactly how much tax is included.
Key Concepts
VAT Category Properties
| Property | Description |
|---|---|
| Name | Display name (e.g., "Standard Rate") |
| Code | A short code for accounting reference (e.g., "STD", "RED") |
| Percentage | The tax rate as a decimal (e.g., 24.00 for 24%) |
| Active | Whether the category is currently available for use |
| Default | Whether this is the pre-selected category for new bookings and products |
Default Category
One VAT category must be the default. When you mark a category as default, the previous default is automatically unset. The default category is pre-selected when you create new inventory products and when new bookings are created. This saves time and ensures a consistent tax rate is applied unless you explicitly choose a different one.
Zero-Rated and Exempt Categories
If some of your products or services are tax-exempt or zero-rated, create a VAT category with a 0% percentage (e.g., "Zero-rated" or "Exempt"). Assigning this category to a product or booking means no VAT is added to the price. The 0% line still appears on invoices for transparency, making it clear that the item was assessed for tax but none was due.
How VAT Appears on Invoices
When an invoice is generated, each booking line includes the VAT category and percentage. The invoice shows a VAT breakdown section that groups amounts by tax rate, so if an order contains products at different VAT rates the customer sees each rate and its total separately. This breakdown helps with accounting and ensures compliance with tax reporting requirements.
How VAT Affects Booking Totals
The VAT percentage from the assigned category is factored into the booking total. When staff or customers view a booking summary, the VAT amount is displayed alongside the net price and the gross total. If you change the VAT category on a booking, the totals recalculate to reflect the new rate.
Common Tasks
Creating a VAT Category
- Navigate to Data > VAT Categories
- Click Add
- Enter the name and code
- Set the percentage rate
- Mark as default if this should be the pre-selected rate for new bookings and products
- Click Save
Updating a Tax Rate
If a tax rate changes, update the percentage on the existing VAT category. This affects future pricing calculations but does not retroactively change existing bookings or invoices.
How It Connects
- Orders — Each booking within an order has an assigned VAT category. The VAT percentage is used to calculate the tax portion of the booking total.
- Invoices — Invoices include a VAT breakdown showing the tax amount per rate. Different bookings on the same invoice can have different VAT categories, and each rate appears as its own line.
- Inventory — Each inventory product is assigned a default VAT category. When you add an inventory product to a trip, the product inherits this VAT category.
- Suppliers — Supplier reports include VAT category information for each booking.