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Taxation

Last Updated: Sep 02, 2020

LogiSense Billing has built in taxation capabilities to handle VAT style taxation. This allows for flexible taxation options as outlined below. Many businesses also leverage LogiSense’s integration with Avalara AvaTax for tax calculations and compliance reporting. The Avalara integration can be tax vendor section of the administration console.

Tax Codes

A tax code defines the attributes associated with a tax rate. For example, a tax code can be defined with the name VAT. Associated with a tax code are the following attributes: Country, State/Province and City. City, State and Country are optional; if they are configured the system will attempt to match tax code based on the service address.

Associated with a tax code are one or more tax rates. Once a tax code has been matched, the system will apply one or more tax rates associated with that tax code. Tax rates are configured as decimal values (i.e, 0.08 = 8%). If multiple tax rates are configured onto a tax code, the system will apply each of those rates to the charge.

As an example lets say a tax code “VAT” was defined with 2 tax rates: GST of 5% and PST of 8%. If this tax code is applied to a $100 service, the total tax computed would be 100 * (0.05 + 0.08) = $13. The total amount charged would therefore be $113.

All applicable taxes on charges will show up as line items on the account (accessed via the transactions tab). They will also be stored in the system and can be displayed on reports and invoices if required.

Account Tax Categories

Account tax categories are used to categorize account level taxes. This account tax category is applied to a specific account. Multiple tax codes can be associated with an account tax category. Account tax categories can be useful when categorizing multiple tax codes under a single category and applying it at the account level for situations such as tax exemption.

Service Tax Categories

Taxes on services can also be categorized via Service Tax Categories. A Service tax category is defined by a name. Each tax code in the system can map to a single service tax category. If a service tax category is associated with a tax code, the system will ensure that the tax code will only be applied to the service, if that service has the corresponding service tax category connected to it.

A single service tax category can be setup on a service. When configuring a service tax category, the system will allow the user to select the service tax category and the tax code. The system will filter tax codes to those applicable to the tax category.

Only Report Tax

Some businesses may wish to not charge the tax themselves but provide a breakdown of the applicable taxes to their customers; their customers in turn will remit the taxes owing to the government. LogiSense supports "Only Report Tax" on tax codes. Tax codes can be set up with one or more usage classes with provisions for "Only Report Tax".