Rentopian offers Automatic and Manual tax calculation options. These settings control how tax rates are determined and how tax is applied to different parts of a transaction.
With both calculation types, Rentopian uses the delivery address on the transaction to determine which tax rate should apply.
Important: Consult your CPA or tax professional.
Rentopian works with rental businesses in many different tax jurisdictions, each with its own rules and requirements for calculating and collecting sales tax. Because these requirements vary by location and business, the Rentopian team cannot provide specific financial or tax advice. Before configuring these settings, consult your CPA or qualified tax professional to determine how your business should calculate and apply sales tax.
Automatic Tax Calculation
With Automatic Tax Calculation, Rentopian connects to a third-party tax database that tracks sales tax rates for different jurisdictions.
You can also control how automatic tax is applied to other charges on the transaction.
These options include:
Apply the automatic tax rate to the Damage Waiver.
Mark the Rush Fee as taxable.
Mark Labor Costs as taxable.
Mark Delivery Fees as not taxable.
Mark Pickup Fees as not taxable.
Delivery and pickup fees are treated as taxable by default when using automatic tax calculation unless you select the options to make them not taxable.
Manual Tax Calculation
With Manual Tax Calculation, Rentopian uses the tax rates you have set up under your Financial and Payment settings.
Manual calculation also allows you to designate different tax types when different parts of your transaction need to be taxed differently.
Choose Your Tax Types
You only need to use separate tax types when different types of items need different tax rates or need to be shown separately.
These can include:
Rental products
Sale products
Services
Delivery fees
If these items are all taxed using the same sales tax rate, you can leave the additional tax types unchecked and use the default Rental tax type.
Items on the transaction will then use the same tax rate unless they are marked as not taxable.
If different types of items need different tax rates, or if you need to show their tax amounts separately, you can enable the additional tax types that apply.
You can also choose whether Rush Fees and Labor Costs are taxable and whether Delivery Fees are not taxable.
To learn about setting up manual tax rates, please check out our Knowledge Base article.
Choose When Discounts Are Applied
Your Tax and Discount settings also control when discounts and coupons are applied in relation to tax.
You have two options:
Apply the discount or coupon after tax is calculated: Tax is calculated before the discount reduces the transaction amount.
Apply the discount or coupon before tax is calculated: The discount is applied first, and tax is then calculated using the discounted amount.
Which option should you choose? The correct tax calculation method, tax types, taxable charges, and discount sequence depend on the rules that apply to your business. Your CPA or tax professional can help you determine which Rentopian settings match your tax requirements.
Need Help?
If you have questions about how to configure manual or automatic tax calculation in Rentopian, contact us at [email protected]. For questions about which tax settings are appropriate for your business, please consult your CPA or qualified tax professional.