Setting Up Taxes Correctly

Ensuring that your transactions, memberships, products, and services are billed accurately and remain compliant with local regulations is crucial. Before you begin selling anything, make sure your tax setup is fully verified. Follow this step-by-step guide to set up your taxes correctly.

Step 1: Access General Settings

1. Go to General Settings.

2. Select Taxes.

Step 2: Define Tax Calculation Method

Determine how taxes are calculated:

• Inclusive of Tax: The tax is already included in the price and is back-calculated based on the percentage you set.

• Exclusive of Tax: The tax amount is added on top of the subtotal.

Ensure you understand the difference before customers start making purchases.

Step 3: Update Tax Rates

1. Click Add Tax.

2. Enter a name and the rate.

3. Click Add Tax again to save.

You can add multiple tax rates if your region requires them.

Step 4: Decide Tax Application

Select where each tax applies. You can choose one or multiple tax rates for each type of membership, service, or product you offer, such as:

• Subscriptions

• Credit Packs

• Courses

• Videos and Playlists

• Classes

• Appointments

• Enrollment Fees

If no tax applies to a certain category, leave it blank.

Step 5: Manage Subscriptions

For subscriptions involving recurring billing, decide whether the tax should apply to all active subscriptions and new purchases, or only to new purchases moving forward. This provides flexibility in deciding the impact of tax changes on current customers versus future sales.

Step 6: Override Default Tax Rules

You can override the default tax rule at the individual level. For example, if a specific course or product shouldn't have tax, you can turn it off while creating that specific item.

Important Note

If you accidentally choose the wrong tax mode (inclusive vs. exclusive), you'll need to remove taxes applied to each category, delete all created tax rates, and then update the main calculation setting. Confirm your setup before launching your pricing or collecting payments.

Conclusion

By following these steps, you've now set up your tax system correctly on Kenko, ensuring accurate billing, compliance, and smooth financial operations from day one.