Setting up tax rules - Amaka Integration (Square-Xero)

[KateCAYA]

Hi there! 

I'm having issues with invoices being created by Square in Xero (using Amaka integration). However, before getting too in the weeds, I want to go back to basics and make sure my VAT setup is correct. 

When creating a tax exemption rule, do I need to apply the 0% as well as the 20% VAT to the specific item? E.g. 

A croissant - 20% to dine-in, 0% to take away. So currently I am adding 20% and 0% to the croissant. Then I create a tax rule within the 20% tax item which states - If the croissant is for takeaway or pickup, do not add the 20% tax. Assuming instead it will add the 0% as the other tax item. 

Is this required? Or do I simply add the 20%, then apply the rule and it will automatically treat it as 0%? 

Thank you 

[Emma_]

Hi @KateCAYA, first of all, welcome to the Seller Community!

I'm sorry you're running into an issue with Amaka integration. This integration is managed by Amaka and their Support team will be able to assist you with this. Here is a link to their Help & Support. 

In regards to your question about tax, you can set up 20% VAT to apply automatically to dine-in items and no taxes for takeaway items. Please have a look at the following Support Center articles to learn more about dining options and tax rules: 

Use Dining Options with the Square App

Use Conditional Sales Tax Rules with the Square App

I hope it helps, let me know if you have any questions. 

[KateCAYA]

Hi Emma. Thank you. What about if the same item can be taken away(0%) or had in (20%)? Should I apply the 20% to that item then create an exemption rule? 

e.g. 20% on croissant then > If Pickup / takeaway do not apply. 

If I do this will 0% automatically be applied to that croissant if it is bought for takeaway? Or do I need to apply 2 taxes to the item (0% and 20%) for the exemption to work? 

Best 

Kate 

[Emma_]

@KateCAYA, if you follow the steps outlined below to set up your tax rules, you don't need to manually apply taxes. 

Before getting started, make sure you complete the following:

1. Turn on Dining Options

2. Create at least one item

3. Create 20% VAT tax

To create Tax Rules to omit taxes based on your Dining Options and Items, please check the following steps.:

1. From your online Square Dashboard, click Items > Sales taxes.

2. Click Create a Tax Rule.

3. Enter a rule name > click Select Tax to choose tax(es) to omit from this rule.

4. Click Select Locations to select locations where the tax rule will apply.

5. Click Select Dining Options > choose the dining option* that will trigger this tax rule.

6. Click Assign Items to select items that will have taxes omitted.

7. Click Save

To customise your dining options, save changes and navigate to Items > Settings > Dining Options to edit, add or remove.

This way, 20% VAT tax will be automatically added to your dine-in orders. You can also create additional tax rules for other dining options. 

[KateCAYA]

Thanks very much Emma. Yes this is as I understood it. I was just double check that when a tax is omitted from an item due to the rule (triggered by dining option), that it would assign 0% in that case. 

[Emma_]

@KateCAYA, for the items with other dining options where a tax is not automatically applied according to the Tax rule, there is no tax assigned at all, which means you won't see 0% tax on the receipt. If you're looking to include 0% to show the customer that the tax was not applied, you can create another Tax rule. 

[KateCAYA]

Thanks Emma