{"id":35546,"date":"2025-06-24T08:48:28","date_gmt":"2025-06-24T08:48:28","guid":{"rendered":"https:\/\/docs.daftra.com\/?post_type=user_manual&#038;p=35546"},"modified":"2025-12-24T11:46:34","modified_gmt":"2025-12-24T11:46:34","slug":"assigning-purchase-tax-sales-tax-to-products","status":"publish","type":"user_manual","link":"https:\/\/docs.daftra.com\/en\/user_manual\/assigning-purchase-tax-sales-tax-to-products\/","title":{"rendered":"Assigning Purchase Tax &#038; Sales Tax to Products"},"content":{"rendered":"<section class=\"wpb-content-wrapper\"><p>[vc_row][vc_column][vc_column_text]To ensure accurate tax reporting and compliance, it&#8217;s important to assign the correct purchase and sales tax rates to each product. This tutorial guides you through the steps to apply sales and purchase tax to products.[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]Click on &#8220;<strong>Product &amp; Services<\/strong>&#8221; from the dropdown menu of &#8220;<strong>Inventory<\/strong>&#8220;. Click on the button &#8220;<strong>Add<\/strong>&#8221; to add a new product.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-42998 size-full\" src=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/Add-new-product.png\" alt=\"\" width=\"1366\" height=\"601\" srcset=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/Add-new-product.png 1366w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/Add-new-product-300x132.png 300w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/Add-new-product-1024x451.png 1024w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/Add-new-product-768x338.png 768w\" sizes=\"auto, (max-width: 1366px) 100vw, 1366px\" \/><\/p>\n<p>Fill in the product details, then beside the taxes fields click on &#8220;<strong>Advanced<\/strong>&#8220;.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-35568\" src=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/hegwzfsa.png\" alt=\"\" width=\"1198\" height=\"633\" srcset=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/hegwzfsa.png 1198w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/hegwzfsa-300x159.png 300w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/hegwzfsa-1024x541.png 1024w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/hegwzfsa-768x406.png 768w\" sizes=\"auto, (max-width: 1198px) 100vw, 1198px\" \/><\/p>\n<p data-start=\"46\" data-end=\"175\">After clicking on \u201c<strong>Advanced<\/strong>,\u201d four tax fields will appear, allowing you to assign both sales and purchase taxes as follows:<\/p>\n<ul>\n<li><strong>Sales Tax 1<\/strong>: The primary tax applied to a product when it\u2019s sold to customers.<\/li>\n<li><strong>Sales Tax 2<\/strong>: An optional secondary sales tax. Useful if your region requires multiple taxes.<\/li>\n<li><strong>Purchase Tax 1<\/strong>: This is the main tax applied when purchasing the product from suppliers. It can match Sales Tax 1 or be selected independently based on purchase tax requirements.<\/li>\n<li><strong>Purchase Tax 2<\/strong>: A secondary purchase tax field. Used when multiple purchase-related taxes are applicable. Can also be set to match Sales Tax 2 or defined separately.<\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-35573 size-full\" src=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/tmjunhyfg.png\" alt=\"\" width=\"1198\" height=\"633\" srcset=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/tmjunhyfg.png 1198w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/tmjunhyfg-300x159.png 300w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/tmjunhyfg-1024x541.png 1024w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/tmjunhyfg-768x406.png 768w\" sizes=\"auto, (max-width: 1198px) 100vw, 1198px\" \/>[\/vc_column_text][vc_message message_box_style=&#8221;3d&#8221; message_box_color=&#8221;sky&#8221;]For more details about adding a new product refer to this <a href=\"https:\/\/docs.daftra.com\/en\/user_manual\/adding-a-new-product-or-a-new-service\/\">guide<\/a>.[\/vc_message][vc_column_text]<\/p>\n<p data-start=\"46\" data-end=\"186\">In this example, we\u2019ll assign VAT as both the sales and purchase tax for the product, then click the \u201c<strong>Save<\/strong>\u201d button to apply the changes.<\/p>\n<p>Now, when creating a sales or purchase invoice for the product &#8220;<strong>Mobile Charger<\/strong>&#8221; the system will include the tax automatically in the invoice as shown below.<\/p>\n<p data-start=\"62\" data-end=\"301\">From the &#8220;<strong>Sales<\/strong>&#8221; dropdown menu, click on &#8220;<strong>Create Invoice.<\/strong>&#8221; In the item field, add the product \u201c<strong>Mobile Charger<\/strong>.\u201d You\u2019ll see that the \u201c<strong>VAT<\/strong>\u201d is automatically applied in the \u201c<strong>Tax1<\/strong>\u201d field, as it was previously assigned to the product.<\/p>\n<p data-start=\"303\" data-end=\"419\" data-is-last-node=\"\" data-is-only-node=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-35575\" src=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/aheGSFz.png\" alt=\"\" width=\"1366\" height=\"633\" srcset=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/aheGSFz.png 1366w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/aheGSFz-300x139.png 300w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/aheGSFz-1024x475.png 1024w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/aheGSFz-768x356.png 768w\" sizes=\"auto, (max-width: 1366px) 100vw, 1366px\" \/><\/p>\n<p>[\/vc_column_text][vc_message message_box_style=&#8221;3d&#8221; message_box_color=&#8221;sky&#8221;]For more details about creating a sales invoice refer to this <a href=\"https:\/\/docs.daftra.com\/en\/user_manual\/how-to-create-an-invoice\/\">guide<\/a>.[\/vc_message][vc_column_text]<\/p>\n<p data-start=\"46\" data-end=\"284\">Now, navigate to &#8220;<strong>Purchase Invoices<\/strong>&#8221; from the &#8220;<strong>Purchases<\/strong>&#8221; dropdown menu and create a new purchase invoice. When you add the same product in the item field, you&#8217;ll notice that &#8220;<strong>VAT<\/strong>&#8221; is automatically applied in the &#8220;<strong>Tax1<\/strong>&#8221; field as well.<\/p>\n<p data-start=\"46\" data-end=\"284\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-35577\" src=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/algdkv.png\" alt=\"\" width=\"1366\" height=\"633\" srcset=\"https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/algdkv.png 1366w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/algdkv-300x139.png 300w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/algdkv-1024x475.png 1024w, https:\/\/docs.daftra.com\/wp-content\/uploads\/2025\/06\/algdkv-768x356.png 768w\" sizes=\"auto, (max-width: 1366px) 100vw, 1366px\" \/><\/p>\n<p>[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_message message_box_style=&#8221;3d&#8221; message_box_color=&#8221;sky&#8221;]For more details about creating a purchase invoice refer to this <a href=\"https:\/\/docs.daftra.com\/en\/user_manual\/adding-purchase-invoice\/\">guide<\/a>.[\/vc_message][\/vc_column][\/vc_row]<\/p>\n<\/section>","protected":false},"author":23,"template":"","categories":[2184],"tags":[],"class_list":["post-35546","user_manual","type-user_manual","status-publish","hentry","category-products-services"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v17.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Assigning Purchase Tax &amp; Sales Tax to Products - Daftra Knowledge Base<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/docs.daftra.com\/en\/user_manual\/assigning-purchase-tax-sales-tax-to-products\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Assigning Purchase Tax &amp; Sales Tax to Products - Daftra Knowledge Base\" \/>\n<meta property=\"og:description\" content=\"[vc_row][vc_column][vc_column_text]To ensure accurate tax reporting and compliance, it&#8217;s important to assign the correct purchase and sales tax rates to each product. 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This tutorial guides you through the steps to apply sales and purchase tax to products.[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]Click on &#8220;Product &amp; Services&#8221; from the dropdown menu of &#8220;Inventory&#8220;. 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