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What is Direct Taxes in Zoho Billing?

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The taxes applicable to your business depend on your location and industry. Zoho Billing supports country-specific tax rules, compound taxes, multiple rates and tax groups, so your invoicing stays accurate and compliant.

How to add a new tax

  1. Go to Settings > Taxes & Compliance > Taxes.
  2. Click + New Tax.
  3. Enter the tax name and rate as a percentage.
  4. Tick Compound Tax if this tax should apply on top of another tax rather than the base amount.
  5. Click Save.

A compound tax is useful when a secondary tax, such as a provincial tax, is calculated on top of another tax, such as a federal tax, rather than on the original amount.

How to edit a tax

  1. Go to Settings > Taxes & Compliance > Taxes.
  2. Click the tax you want to edit.
  3. Make your changes and click Save.

If the tax is already used on past transactions, Zoho Billing asks whether you want to update those with the new rate.

How to delete a tax

  1. Go to Settings > Taxes & Compliance > Taxes.
  2. Hover over the tax you want to remove and click the trash icon.
  3. Confirm in the pop-up.

How to create a tax group

Tax groups let you apply more than one tax together on a transaction, for example a standard tax alongside a separate levy.

  1. Go to Settings > Taxes & Compliance > Taxes > Tax Rates.
  2. Click + New Tax Group.
  3. Enter a group name and select the individual taxes to include.
  4. Click Save.

The group’s total rate is the sum of the taxes you selected.

How to create taxes in bulk

  1. Go to Settings > Taxes & Compliance > Taxes > Tax Rates.
  2. Click the dropdown next to + New Tax and select Create Taxes in Bulk.
  3. Enter each tax name and rate, using + Add Tax for more rows.
  4. Tick These taxes are compound taxes if needed, and choose a common tracking preference.
  5. Click Save.

Frequently asked questions

What is a compound tax?

A secondary tax, such as a provincial tax, calculated on top of another tax, such as a federal tax, rather than on the base amount alone.

Can I add several tax rates at once?

Yes, use Create Taxes in Bulk to enter multiple tax names and rates in one go instead of adding them individually.

What happens if I edit a tax already used on past invoices?

Zoho Billing asks whether you want to update those existing transactions with the new rate.

Need help?

Need help configuring taxes in Zoho Billing? Contact support@thoughtlogik.com or see our Zoho implementation services.

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