Set up a single state tax

Taxation is calculated by using tax rules that apply tax rates based on tax classes. 

In this guide, we’ll look at setting up a tax rule that applies a single state tax. We’ll use the example of Florida, where there’s a general 6% sales tax at the time of writing. Keep in mind this is just for guidance – consult tax guidance for your state or region before proceeding.

Head to System setup > Tax rates. Hit the green add tax rate button at the top.

Enter a name for your tax rate, choose the country and state where it applies, then enter the percentage. In our example, we’ve put the name as “Florida Sales Tax”, country as “United States”, state as “Florida”, and rate as 6.00.

When you’re done, click the blue Create Tax Rate button.

Once you’ve created a tax rate, go to System setup > Tax rules. Click the green Add a new tax rule button at the top.

Give your tax rate a name and tick all of the tax class boxes and the tax rule you just created. This tells the system to apply your tax rule to all products and organisations. We’ve named our example “Sales Tax”.

You can safely ignore the priority and sort order boxes – these are used in cases of multiple tax rates where you might need to compound rates.

When you’re done, click the blue Create Tax Rule button.

Tax will automatically be applied to new opportunities where the address matches your tax rule. 

The address used for tax calculation purposes is set in System Preferences. You can choose from:

The changes will not apply retroactively to existing opportunities. For example, if a tax rate changes in your region after a specific date, you would not want to alter past orders. To recalculate the tax on a particular opportunity, locate the opportunity and click on "Recalculate" under the Actions menu.