Manage tax rates in Katana to ensure accurate order totals and compliance across sales and purchase transactions.
How Katana handles taxes
Prices in Katana are tax-exclusive.
Sales prices, purchase prices, and costs are always recorded without taxes.
Taxes are only applied to orders for display and reporting purposes.
Taxes are used to:
Calculate the total price on sales orders (SOs).
Calculate the total cost on purchase orders (POs).
Ensure totals match when syncing with e-commerce or accounting platforms.
Note: Taxes do not affect inventory valuation or Cost of Goods Sold (COGS) in Katana.
Why adding taxes matters
Customer-facing documents: SOs (or invoices created outside Katana) may require totals with taxes.
Supplier communication: POs sent to suppliers often need totals that include taxes.
System integrations: Matching totals between Katana, accounting platforms (e.g., QuickBooks, Xero), or e-commerce channels is easier when taxes are included.
Katana does not generate invoices. If you create invoices outside Katana, you can copy the tax details directly from SOs.
Creating and editing tax rates
Go to Settings > Tax rates.
Add new tax rates, or edit/delete existing ones.
Choose a default tax rate for SOs and POs.
The first tax rate in the list is automatically used as the default.
Drag and drop tax rates to reorder them.
Once set, tax rates can be applied to items on SOs and POs as needed.
Notes
Tax rates in Katana are flexible: create as many as you need for different items or locations.
Changing the order of tax rates updates which one is used by default.
Always align your Katana tax rates with your accounting system to avoid reconciliation issues.
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