31. How to use inclusive / exclusive taxation?

How to switch between inclusive and exclusive taxation?

In Sleek Bill there is one general option to switch between inclusive and exclusive taxation for all of your documents. To do the switch go to Settings - Company Details - Tax Inclusive - Select Yes or No - Save.

How does inclusive / exclusive taxation work?

Let’s take an example:
You sell laptop backpacks that cost 2000 INR per piece, taxed at 12% GST.

If this price includes all your taxes (ie this is your final price) and you want to show the GST breakdown from it, you should choose Tax Inclusive in your Settings.
If you sell to a client within the same state as you, this is how it will look on your invoice:

If 2000 INR is your unit price, and GST tax applied on top on it, you should select Tax Exclusive in your Settings.
If you sell to a client within the same state as you, this is how it will look on your invoice:

How to use inclusive / exclusive taxation in bills & PO’s?

When creating a new purchase order or a bill, you can select the type of taxation for your prices straight on it. You can choose from prices inclusive of tax and exclusive of tax. Whichever you choose, Sleek Bill calculates the correct tax breakdown (CGST, SGST or IGST) for you.

Does inclusive / exclusive taxation work with CESS?

When you add CESS as a percentage (%) to your items and you switch between exclusive and inclusive taxation, you CESS will be calculated accordingly.
Example:
If your product has a price of 1000 INR inclusive of taxes, a GST rate of 5% and CESS 10%, this is how it will look in your invoice:

If your product has a unit price of 1000 INR exclusive of taxes, a GST rate of 5% and CESS 10% this is how it will look in your invoice:

What happens when I switch back from inclusive taxation to exclusive taxation?

When you switch between price inclusive and price exclusive your new invoices will reflect the changes. The old invoices will remain as they are, no information will change on them, and your new invoices will reflect items with changed prices and tax.
Your invoices report will show the correct amounts, balances and taxes for each invoice.
Your items report will show you the correctly calculated values for amount of goods sold, cost of goods sold and margins.

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