Tax Management

Effective tax management ensures your tailoring business remains compliant with tax regulations while maximizing legitimate deductions. The Finance Module provides comprehensive tools to track, calculate, report, and pay various taxes applicable to your business.

Types of Taxes for Tailoring Businesses

VAT/Sales Tax Management

Setting Up VAT/Sales Tax

1. Go to Finance > Settings > Tax Configuration
2. Click "Add Tax Rate"
3. Enter the tax name (e.g., "Standard VAT")
4. Enter the tax rate percentage
5. Select the tax authority
6. Configure tax reporting period (monthly, quarterly)
7. Set up tax account mappings
8. Save the tax configuration

Recording VAT/Sales Tax

The system automatically calculates and records tax on transactions:

• Sales Invoices: Select the appropriate tax rate when creating invoices
• Purchase Invoices: Record input tax on business purchases
• Cash Sales: Tax is calculated automatically based on the product or service tax category

VAT/Sales Tax Reports

Generate reports for tax filing and compliance:

1. Go to Finance > Taxes > VAT Reports
2. Select the tax authority
3. Choose the reporting period
4. Generate the report
5. Review the calculated tax liability
6. Export the report for filing or record-keeping

Filing and Paying VAT/Sales Tax

1. Generate the VAT/Sales Tax report for the filing period
2. Review and verify the calculated amounts
3. Go to Finance > Taxes > Tax Payments
4. Click "Record Tax Payment"
5. Enter the payment details (date, amount, payment method)
6. Upload any filing confirmation documents
7. Save the payment record

Income Tax Management

Tracking Taxable Income

The system helps you track all revenue and expenses relevant to income tax:

• All sales are recorded with appropriate revenue categorization
• Expenses are categorized according to tax deductibility
• Capital assets are tracked with depreciation schedules
• Business vs. personal expenses are clearly separated

Income Tax Reports

Generate reports to assist with income tax preparation:

• Profit & Loss Statement: Shows taxable income for the period
• Tax Deduction Summary: Lists all tax-deductible expenses by category
• Depreciation Schedule: Tracks depreciation of capital assets
• Tax Provision Report: Estimates tax liability based on current financial data

Payroll Tax Management

Setting Up Payroll Taxes

1. Go to Finance > Settings > Payroll Taxes
2. Configure each required tax type:
   • Income tax withholding
   • Social security contributions
   • Health insurance
   • Other mandatory deductions
3. Set up tax rates and calculation methods
4. Configure employer contributions
5. Set up tax payment schedules
6. Save the payroll tax configuration

Processing Payroll Taxes

The system automatically calculates payroll taxes during payroll processing:

1. Go to Finance > Payroll > Process Payroll
2. Select the pay period
3. Review employee hours and earnings
4. The system calculates all tax withholdings automatically
5. Review and approve the calculations
6. Process the payroll
7. Tax liabilities are automatically recorded in the appropriate accounts

Payroll Tax Reports and Filings

Generate reports for payroll tax compliance:

• Payroll Tax Summary: Overview of all payroll taxes for the period
• Employee Tax Withholding Report: Detailed breakdown by employee
• Employer Contribution Report: Summary of employer-paid taxes
• Tax Filing Forms: System-generated forms ready for submission to tax authorities

Import Duties and Customs

Tracking Import Duties

For tailoring businesses that import fabrics or other materials:

1. Go to Finance > Purchases > Record Import
2. Enter supplier and product details
3. Record the import value
4. Add import duty and customs fees
5. Upload customs documentation
6. Save the import record

Tax Calendar and Reminders

Setting Up Tax Reminders

1. Go to Finance > Taxes > Tax Calendar
2. View upcoming tax deadlines
3. Configure reminder notifications
4. Set advance notice periods (e.g., 2 weeks before deadline)
5. Specify who should receive reminders
6. Save reminder settings

Tax Audit Preparation

Audit-Ready Records

The system helps you maintain audit-ready tax records:

• Document Attachment: Attach digital copies of receipts, invoices, and tax documents to transactions
• Audit Trail: Track all changes to financial records with user, date, and time stamps
• Tax Calculation Documentation: System maintains detailed records of how each tax amount was calculated
• Historical Tax Reports: Access to all previously filed tax reports and returns

Tax Audit Reports

Generate comprehensive reports for tax audits:

1. Go to Finance > Taxes > Audit Reports
2. Select the tax type and period
3. Generate detailed transaction reports
4. Export reports in audit-friendly formats
5. Create document packages with supporting evidence

Tax Planning and Optimization

Tax Planning Tools

Use the system's planning tools to optimize your tax position:

• Tax Projection Reports: Estimate future tax liabilities based on projected income and expenses
• What-If Analysis: Model different business scenarios and their tax implications
• Deduction Optimizer: Identify potential tax deductions you may be missing
• Year-End Tax Planner: Suggestions for year-end actions to optimize tax position