How Do I Manage My Tax Codes?


Tax Codes are codes that are assigned to customers and sales transactions to determine the amount of tax to be charged on that transaction.  Each individual Location in ESC can be assigned its own separate Tax Code in order to accommodate various city, county and state taxes that you may be subject to in your area of service.

Adding and Editing Tax Codes

  1. Go to Sales → Enter Tax Codes.  

  2. Click Add New to create a new code, or double-click on an existing Tax Code to edit it.
  3. Create a Code for your new tax code and give it a clear Description that will help you assign it to customer locations in the future.
  4. If the tax will be paid by the customer based on the price of the invoice, make it a Retail Tax. This is the most common kind of sales tax. If the tax will be paid by your company based on your costs of the items on the invoice instead, select Cost Tax. A cost tax does not increase the price of the invoice to the customer, only the cost of it to your company. If Cost Tax is selected you will also be required to select the account that will be debited when this tax code is used. This account is typically a Cost of Goods Sold type account.

  5. Now enter all the components that make up the sales tax as separate line items. Assign each line item a name, an account (generally a Sales Tax Payable account), rate and vendor. On each line you must also declare what will be taxed. Select between any combination of Labor, Material, Other and Service Agreements.
  • Tax Lab - This option encompasses billing codes with a type of Labor or Helper.
  • Tax Mat - This option includes all inventory parts and billing codes with a type of Material, Equipment, Mat Markup or Equip Markup.
  • Tax Other - This option includes all billing codes with a type of Contract, Discount, Other and Other Markup.
  • Tax SA - This option includes billing codes with a type of Agreement.


Warning!  If you are integrated with QuickBooks or Sage 50, any additions or changes to your Tax Codes will need to also be made in your accounting software.  You can run the Accounting Connection Wizard in ESC's File menu to ensure all Tax Codes match up to your accounting software properly.

Canadian Tax Considerations

Piggyback Tax Calculations

Select this option to apply the tax shown on lines 2 - 6 to the invoice total plus the tax assigned on higher lines. This can be very useful for Canadian customers who have a PST that is applied to the total of the invoice plus the amount of the GST.

Example: The first line in the tax code is GST for 5%. The second line of the tax code is PST at 8%. When this tax code is applied to a $100.00 invoice the tax will be $13.40. This is calculated as follows: $100.00 x 5% = $5.00. Now we add that tax to the invoice amount before calculating the next tax line: $100.00 + $5.00 = $105.00 x 8% = $8.40. So the invoice total is $105.00 + $8.40 = $113.40.

Separate Canadian GST/PST on Invoice

Checking this option for Canadian ESC users will allow the invoice to print with the GST and PST taxes listed separately. In order to use this the tax code must only contain two lines and the first line must be the GST.

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