---
title: "Setting up tax rates"
description: "Create the tax rates you apply to payments and splits—inclusive or exclusive, by type and jurisdiction."
lastModified: "2026-06-13"
lang: "en"
wordCount: 417
url: https://qualyhq.com/training/settings/tax-rates
---
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# Setting up tax rates

> Apply the right tax to payments and payouts.

## At a glance

- **Intended for:** Everyone
- **Available in:** All plans
- **Reading time:** 3 minutes
- **Last updated:** 31st May 2026

## Quick summary

In Settings → Tax rates, create tax rates (such as VAT or sales tax) with a public name, a type, and a country/state. A rate can be inclusive (doesn't change the total) or exclusive (added on top). Tax rates can then be applied to payments and splits.

## Overview

Tax rules vary by place and product. **Settings → Tax rates** lets you define the rates you apply to **payments** and **splits**.

## Creating a tax rate

Create a rate with:

- A **public name** (shown to customers)
- A **type** (for example **VAT** or **sales tax**)
- A **country and state/province**
- **Inclusive** or **exclusive**

### Inclusive

The tax is already part of the price and **doesn't change the total**.

### Exclusive

The tax is **added on top** of the amount.

## Applying tax

Apply your rates to **payments** (per item, so the breakdown is correct) and to **splits**. The public name appears to customers so the tax is clear.

If a rate becomes out of date, **archive** it. Archived rates are flagged as likely outdated, which stops you applying the wrong tax.

Tax **rates** here are what you charge customers. Your own **tax IDs** (for your invoices) live in Billing information.

## Frequently asked questions

### Where do I set up tax?

In Settings → Tax rates. Create the rates you need—such as VAT or sales tax—and apply them to payments and splits.

### What's the difference between inclusive and exclusive tax?

An inclusive tax is already part of the price and doesn't change the total; an exclusive tax is added on top of the amount.

### Can I set tax by country?

Yes. Each rate has a country and state/province, so you can apply the correct tax by jurisdiction.

### Does the customer see the tax name?

Yes—the public name you give a rate is shown to customers, so it's clear what the tax is.

### Where is tax applied?

To payments and splits. On a payment you can apply the relevant rate to items so the breakdown is correct.

### What if a tax rate is out of date?

You can archive a rate. Archived rates are flagged as likely outdated so you don't apply them by mistake.

## Prefer doing this via the Qualy API?

Head over to our developer docs for everything you need—endpoints, examples, and simple how-tos.

[View API Docs](https://docs.qualyhq.com/docs)

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