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New feature - Category tax!
Do you need to apply different tax rates to different types of spend?
With our new Category Tax feature, you now can! This means more accurate tax tracking and less manual checking for you and your employees.
How does it work?
If you haven’t already,
- Enable Tax Tracking in your policy
- Set your default policy currency and foreign currency tax rates
- You'll also need to have a Control level policy in order to have the ability to edit category rules.
If a particular policy currency expense type should have a different tax rate to either of these, set this by heading to the Categories page then click Edit Rules next to the relevant category and it will be applied to new expenses instead of the policy currency default.
Just like today, employees and approvers can change the default tax rate and amount applied to an expense. Expenses with a non-default tax rate or amount will be highlighted to reviewers.
We set our own policy for UK employees so that:
- When our team is spending money in the UK, we want to apply the Standard VAT 20% rate to most expenses. So we set this as the policy currency default for all GBP expenses
- However, transport in the UK (including trains and taxis) is exempt of VAT so we set the No VAT 0% rate on the Transport category. This rate automatically applies to any transport expenses instead of the policy default of 20% - without our employees or finance team needing to manually review every expense
- When they’re travelling outside of the UK, we know that non-GBP expenses won’t have UK VAT so we set a No VAT 0% rate as the foreign currency default*
*This is an example only. We are not accountants and cannot provide tax advice. We recommend consulting your tax advisor to understand what tax rules apply to you.
Learn more about Tax Tracking in Expensify here and please get in touch with any questions or feedback.