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Tax Information

roomMaster provides five account codes for taxes. Account codes 105 through 109 are hard coded for this purpose and cannot be changed. All other account codes can be marked to have any or all of these taxes applied when the account code is used for a transaction. You may also want to change the description of the tax account codes to be more descriptive on the guests folio, such as "Resort Tax" or "County Tax", by editing the Description field on the General tab of the tax account code.

To setup tax rates and options, select Setup > Configuration > Guest Ledger > Account Codes and access account codes 105 through 109. The following options are on the Tax Information tab.

Tax Type - Each tax account code can be configured as a percent of amount, flat amount, Canadian percent, VAT/GST or per adult.

  • Percent of amount is used for traditional taxes (sales tax, room tax, etc.). When a taxable charge is made, roomMaster automatically charges the tax to the item. Enter the percentage in the amount field such as 6.50 for 6.5%.

  • Flat amounts are used in some states, provinces, or countries for special type taxes. A flat amount is added to the folio each time a charge is made. Enter the tax as a dollar amount in the amount field.

  • Each Adult will charge a flat tax amount multiplied by the number of adults in the room (Bahamas). Enter the tax as a dollar amount in the tax amount field to charge per each adult.

  • Canada Percent (All) is used against the original amount plus taxes added so far in the transaction. (Tax on Tax) Example: If tax 1 is set to Percent of Amount and tax 2 is Canada Percent (All) and tax 3 is Canada Percent (All), both tax 2 and tax 3 would be incremental of the original amount plus any taxes applied previously in the transaction. $50.00 x 5% = $2.50, then $52.50 x 7% = $3.68 as tax 2, then 56.18 x 10% = $5.62 as tax 3. (Quebec, Montreal)

  • Canada Percent (105 Only) is used against the original amount plus taxes added from Tax Rate 1 in the transaction only. (Tax on Tax) Example: If tax 1 is set to Percent of Amount at 5%, tax 2 is 7% and tax 3 is 10%, then the original amount + tax amount for tax rate 1 is added together and used as the base amount for any remaining taxes. $50.00 x 5% = $2.50, then $52.50 x 7% = $3.68 as tax 2 and $52.50 x 10% = $5.25 as tax 3. This type of tax is usually used in foreign markets.

  • Inclusive (VAT/GST) is used in countries such as England, Ireland, South Africa, and Australia. The amount posted is posted including tax. (The tax is broken down after the posting).

  • Exclusive (VAT/GST) is used to back out VAT/GST. Posting a $50.00 VAT 3% transaction would result in a $44.00 posting. This is usually used for tax-exempt postings for VAT/GST.

Default Rate - Configure the current tax information in this location. Enter the Tax Amount to be applied, either percentage or flat amount. For example, enter 6.50 for 6.5% or 10.00 for $10. If you are not aware of changes to the tax rate in the near future, leave the start and end date blank.

Alternate Rate - Use this section to configure a tax rate change for the future, for example, if a state increases their state sales tax. Enter the new tax amount in the Tax Amount field. Enter the first date the new tax rate should be applied in Start Date. The new tax rate will automatically be charged for all account codes the tax account code is applied to beginning on the start date.

Example

Let's say your current State Sales Tax 7%, but is going to increase to 7.5% as of October 1, 2011. The Default Rate tax amount should be 7.000 and the start and end dates blank. In the Alternate Rate section, enter 7.500 and a start date of 10/01/2011. With this configuration, any transactions using account codes with the State Sales tax applied will have 7.5% applied as of October 1st. Any time after October 1st, access the tax account code and change the Default Rate tax amount to 7.500 and delete the tax amount and start date in the Alternate Rate section.

Maximum Tax Amount - Enter the maximum, flat amount of tax that can per charged per day for the specific tax account code. Leave this field blank if there is no maximum

Agency Name - This is used when exporting information for the accounting interfaces. The Import/Export Wizard creates a liability in this agency's name. You should have already created the vendor in your accounting software before exporting. For more information, please see Import/Export Wizard.

Account Codes

The tax account codes (105 through 109) cannot be marked as taxable. The descriptions on these accounts can be changed to be more descriptive of the type of tax such as "Florida Sales Tax", "County Bed Tax" or "Liquor Tax" which will display on the guest folio.

Room Revenue accounts are setup through Setup > Configuration > Guest Ledger > Account Codes on the Options tab. These are the accounts which appear on the pull-down tabs in Reservations, Guest Ledger, etc.

You have the ability to select on the folio level if you want incidentals account codes (account codes not marked as room revenue) to have the tax added or not.