Taxes

Tax management in Crane Ledger handles sales tax, VAT, and other tax calculations for invoices and bills. Tax rates can be configured at the organization level and applied to line items.

The Tax Object

{
  "id": "tax_xxxxxxxxxxxxxxxx",
  "object": "tax",
  "organization_id": "org_xxxxxxxxxxxxxxxx",
  "name": "California Sales Tax",
  "description": "State sales tax for California",
  "rate": "8.2500",
  "tax_type": "sales_tax",
  "is_active": true,
  "is_compound": false,
  "created_at": "2024-01-01T10:00:00Z",
  "updated_at": "2024-01-01T10:00:00Z"
}

Attributes

List Taxes

Returns a list of tax rates for the organization.

Path Parameters

Query Parameters

Response

{
  "object": "list",
  "data": [
    {
      "id": "tax_xxxxxxxxxxxxxxxx",
      "name": "California Sales Tax",
      "rate": "8.2500",
      "tax_type": "sales_tax",
      "is_active": true
    },
    {
      "id": "tax_yyyyyyyyyyyyyyyy",
      "name": "Federal Excise Tax",
      "rate": "2.5000",
      "tax_type": "excise",
      "is_active": true
    }
  ],
  "has_more": false,
  "total_count": 2
}

Create Tax

Creates a new tax rate for the organization.

Path Parameters

Request Body

Response

{
  "id": "tax_xxxxxxxxxxxxxxxx",
  "organization_id": "org_xxxxxxxxxxxxxxxx",
  "name": "New York Sales Tax",
  "description": "State sales tax for New York",
  "rate": "8.8750",
  "tax_type": "sales_tax",
  "is_active": true,
  "is_compound": false,
  "created_at": "2024-01-15T14:30:00Z",
  "updated_at": "2024-01-15T14:30:00Z"
}

Get Tax

Retrieves the details of a specific tax rate.

Path Parameters

Update Tax

Updates an existing tax rate.

Path Parameters

Request Body

Delete Tax

Deletes a tax rate. Tax rates with associated transactions cannot be deleted.

Path Parameters

Tax Types

Sales Tax

• Applied to retail sales and services
• Varies by jurisdiction (state, county, city)
• Can be single rate or combined rates

VAT (Value Added Tax)

• Common in European countries
• Applied at each stage of production/distribution
• Businesses can reclaim VAT paid on inputs

Excise Taxes

• Applied to specific goods (alcohol, tobacco, fuel)
• Fixed amount per unit or percentage of price
• Often collected by specialized tax authorities

Tax Calculations

Single Tax Rate

Item Price: $100.00
Tax Rate: 8.25%
Tax Amount: $8.25
Total: $108.25

Multiple Tax Rates

Item Price: $100.00
State Tax (6%): $6.00
Local Tax (2.25%): $2.25
Total Tax: $8.25
Total: $108.25

Compound Taxes

Item Price: $100.00
Base Tax (8%): $8.00
Compound Tax (5% on $108): $5.40
Total Tax: $13.40
Total: $113.40

Best Practices

Tax Rate Management

• Keep tax rates up to date with regulatory changes
• Document rate change effective dates
• Maintain audit trails of rate modifications

Multi-Jurisdiction Compliance

• Track applicable tax rates by location
• Automate tax calculation based on customer location
• Maintain records for tax authority audits

Tax Calculation Accuracy

• Use precise decimal calculations to avoid rounding errors
• Apply taxes at the line item level for accuracy
• Support both inclusive and exclusive tax display

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