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Compound Tax

SlickPie allows you to keep track of your income and expenses based on the taxes. There are three ways taxes are being applied and calculated, Compound Tax, and Recoverable Tax & Non-Recoverable Tax.

 

Here we will talk about Compound Tax. Visit Recoverable & Non-Recoverable Tax for more information.

 

Compound Tax is a tax that is applied on top of the primary tax. In other terms, a compound tax is added to the subtotal of the product/ service provided plus the taxes applied to it.

 

Create a Compound Tax

As Compound Tax is on top of the base tax, you need more than 1 component to add a compound tax.

 

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For instance, Paula created a Standard Tax with the following components and selected HST as Compound Tax.

 

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When Paula creates an invoice with Standard Tax, first the non-compounded tax (GST & PST) is calculated on the line item. Then Compound Tax is calculated on the sum of the line item and sum of non-compound tax.

 

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As in the invoice above:

  1. GST (5%) on $330.00 is $16.50
  2. PST (7%) on $330.00 is $23.10
  3. Tax Total is $39.60 and the Total will be $369.60.
  4. Since Compound Tax (2%) is calculated on Total of Line Item and Taxes, it will be $7.39 on $369.60 making it the Total of $376.99.

Thus the Taxes calculated is $46.99.

 

 

Please note You can not edit/ delete a tax if a transaction is posted using that particular tax.

 

 

 

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