If certain inventory items should not be taxed, you can mark their associated inventory codes as non‑taxable. Once updated, any item assigned to that code will automatically be treated as non‑taxable during sales transactions. This ensures consistency and reduces manual tax adjustments.
This article walks through the steps to update an inventory code to non‑taxable.
Steps to Mark an Inventory Code as Non‑Taxable:
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Home > Item > Inventory Standards
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You’ll want to select the desired code on the Codes tab.
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Next, select the Sales Tax tab, and select the All items are not taxable option.
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How This Affects Items
- Any item linked to this inventory code will automatically be set to non‑taxable at the point of sale.
- This is ideal for:
- Tax‑exempt goods
- Government‑mandated tax‑free categories
- Special exemptions for certain product types
Best Practices
- Review existing items under the code to ensure all should be non‑taxable.
- Document changes to codes, especially if your accounting or compliance team requires tracking.Select OK to save all changes.