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Tax Exempt vs Zero Tax
Overview
When working with products and services it is important to track when an item is non-taxable. In StudioCloud we call this the Tax Status and there are three possible values for the tax status of a product or service: Standard, Tax Exempt, and Zero Tax The difference between each of these is available below.
- Standard - The tax rates specified in the invoice/estimate/quote are applied to a product with this tax status.
- Tax Exempt - No tax is charged for this tax status in an invoice/estimate/quote.
- Zero Tax - No tax is charged for this tax status in an invoice/estimate/quote.
As you can see, Tax Exempt and Zero Tax have exactly the same affect on the product or service in the invoice/estimate/quote. Zero tax is typically just used in Canada whereas everywhere else tax exempt is typically only used.
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