Tax Configuration
concorbit supports configurable tax rates per workspace. You can define multiple tax rates, mark one as the default, and apply them to invoice line items. This page covers setting up tax rates, UK VAT configuration, and how tax is calculated on invoices.
Default Tax Rates
When a new workspace is created, concorbit automatically seeds two tax rates:
| Name | Rate | Default |
|---|---|---|
| Standard VAT | 20.00% | Yes |
| Zero-rated | 0.00% | No |
These defaults are based on UK VAT. You can modify them, add additional rates, or change the default to suit your business.
Configuring Tax Rates
Tax rates are managed from the billing settings interface. Viewing tax rates needs billing.view. Creating or updating a tax rate needs billing.edit, and deleting one needs billing.delete.
Creating a Tax Rate
Navigate to the tax rates configuration (accessible from billing settings).
Click Add Tax Rate.
Enter:
Name: A descriptive name (e.g. "Standard VAT", "Reduced Rate", "Sales Tax").
Rate: The percentage rate as a decimal (e.g. 20.00 for 20%, 5.00 for 5%).
Is default: Whether this rate should be the default for new line items.
Click Save.
Editing a Tax Rate
Find the tax rate in the list.
Click Edit.
Change the name, rate, or default status.
Click Save.
Editing a tax rate does not retroactively change existing invoices. Invoices that were created with the old rate retain their original tax calculation.
Deleting a Tax Rate
Find the tax rate in the list.
Click Delete.
Confirm the deletion.
You cannot delete a tax rate if it is the only one in your workspace. You should not delete a tax rate that is referenced by existing invoices or products, deactivate it instead.
Setting the Default Rate
One tax rate must be marked as the default. The default rate is:
Pre-selected when adding line items to invoices.
Applied automatically when no other rate is specified.
To change the default:
Edit the tax rate you want to make the default.
Toggle Is default on.
Save. The previous default is automatically un-defaulted.
Activating and Deactivating Tax Rates
Each tax rate has an active/inactive toggle:
Active rates appear in the tax rate picker when creating invoices and products.
Inactive rates are hidden from pickers but remain linked to any existing invoices that reference them.
Deactivate old rates rather than deleting them. This preserves the audit trail on historical invoices.
UK VAT Setup
concorbit is pre-configured for UK VAT. The default setup includes:
Standard Rate (20%)
The standard VAT rate applies to most goods and services in the UK. This is the default rate applied to new line items.
Zero-Rated (0%)
Zero-rated goods and services are technically VAT-taxable but at a rate of 0%. Examples include:
Most food and drink.
Children's clothing.
Books and newspapers.
Certain medical and disability supplies.
Zero-rated is different from exempt, zero-rated transactions are still reported on VAT returns.
Adding Additional UK VAT Rates
You may need to add additional rates for your business:
| Rate name | Percentage | When to use |
|---|---|---|
| Reduced Rate | 5.00% | Home energy, children's car seats, smoking cessation products |
| Exempt | 0.00% | Insurance, financial services, education, health services |
To add the Reduced Rate:
Create a new tax rate with name "Reduced Rate" and rate 5.00.
Leave "Is default" unchecked.
Save.
To add an Exempt rate:
Create a new tax rate with name "Exempt" and rate 0.00.
Leave "Is default" unchecked.
Save.
While Exempt and Zero-rated both have a 0% rate in terms of the calculation, maintaining them as separate tax rates helps with VAT return reporting, you can distinguish between zero-rated and exempt transactions by the tax rate name on your invoices.
How Tax Is Calculated
Tax is calculated per line item on each invoice:
Calculation Steps
Line item subtotal = quantity x unit price.
Tax amount = line item subtotal x (tax rate / 100).
Tax is rounded to the nearest minor currency unit (penny/cent) per line item.
Invoice Tax Totals
The invoice aggregates tax across all line items:
Subtotal = sum of all line item subtotals (before tax).
Tax amount = sum of all line item tax amounts.
Total = subtotal - discount + tax amount.
Example Calculation
An invoice with two line items:
| Item | Qty | Unit Price | Subtotal | Tax Rate | Tax |
|---|---|---|---|---|---|
| Monthly hosting | 1 | 50.00 | 50.00 | 20% VAT | 10.00 |
| Domain registration | 2 | 15.00 | 30.00 | 20% VAT | 6.00 |
Subtotal: 80.00
Tax: 16.00
Total: 96.00
Mixed Tax Rates
An invoice can contain line items with different tax rates:
| Item | Qty | Unit Price | Subtotal | Tax Rate | Tax |
|---|---|---|---|---|---|
| Consultancy | 5 | 100.00 | 500.00 | 20% VAT | 100.00 |
| Training materials | 1 | 50.00 | 50.00 | Zero-rated | 0.00 |
Subtotal: 550.00
Tax: 100.00
Total: 650.00
The invoice and PDF clearly show which tax rate was applied to each line item.
Applying Tax to Products
Products in your catalogue do not have a built-in tax rate field. Tax rates are applied at the invoice line item level. When you add a product to an invoice:
The product's name and price are populated into the line item.
The default tax rate is pre-selected.
You can change the tax rate for that specific line item if needed.
This approach gives you flexibility to apply different tax rates to the same product depending on the context (e.g. a product might be zero-rated for certain customers or in certain jurisdictions).
Tax on Credit Notes
Credit notes follow the same tax calculation as invoices. Each credit note line item has:
A subtotal (quantity x unit price).
A tax rate and calculated tax amount.
The credit note total includes the tax amount.
When a credit note is applied to an invoice, the full credit amount (including tax) reduces the invoice's outstanding balance.
Tax Reporting
concorbit does not generate VAT returns or tax reports directly. However, you have the data to prepare them:
Every invoice records the tax rate and tax amount per line item.
Credit notes record tax adjustments.
You can filter invoices by date range and status to calculate:
Total tax collected (sum of tax amounts on paid invoices).
Total tax on sales (sum of tax amounts on all issued invoices).
Tax on credit notes (sum of tax amounts on applied credit notes).
Export your invoice data for use in your accounting software or for submission to HMRC.
VAT Return Preparation Tips
Filter by period: Use the invoice list date filters to select the VAT quarter.
Include only finalised invoices: Filter for Sent, Paid, and Overdue statuses. Exclude Drafts.
Subtract credit notes: Deduct the tax on applied credit notes from the total.
Separate by rate: If you use multiple tax rates, group your totals by rate name to fill in the correct boxes on your VAT return.
Multiple Workspaces
If your organisation operates multiple workspaces (e.g. for different entities or regions), each workspace has its own independent set of tax rates. Tax rates configured in one workspace do not affect another.
Common Configurations
UK-Only Business
Use the default setup:
Standard VAT at 20% (default).
Zero-rated at 0%.
Add Reduced Rate at 5% and Exempt at 0% if needed.
Non-VAT Registered Business
If your business is not VAT registered:
Edit the default Standard VAT rate and set it to 0%.
Or create a single "No VAT" rate at 0% and set it as default.
Remove or deactivate the Standard VAT rate.
International Business
For businesses that sell to customers in multiple tax jurisdictions:
Create separate tax rates for each jurisdiction (e.g. "UK VAT 20%", "Ireland VAT 23%", "US Sales Tax 0%").
Select the appropriate rate per line item when creating invoices.
The default rate applies to your most common jurisdiction.
Reverse Charge
For B2B sales where the reverse charge mechanism applies:
Create a "Reverse Charge" rate at 0%.
Apply it to line items on invoices to qualifying business customers.
Add a note to the invoice explaining that VAT is due under the reverse charge mechanism.