Tax Configuration

This is the most consequential setting in Kassly. Your tax type decides whether 12% VAT is carved out of every sale, what your reports show as revenue, and what prints on your receipts. Getting it wrong does not break the app — it quietly produces wrong numbers for months.

Set it once, before your first real sale, and check a printed receipt afterwards.

Everything here lives in Settings → Store Settings → Tax Settings.

Pick your tax type

Kassly has one dropdown, Tax Type, with three options. Pick the one that matches your BIR Certificate of Registration (Form 2303) — not the one that sounds best.

Option	Who it is for	What Kassly does
VAT-Registered (12% VAT)	Businesses registered as VAT taxpayers on their 2303	Splits 12% output VAT out of every vatable sale. Reports show revenue net of VAT.
Non-VAT (Percentage Tax)	Businesses under the percentage-tax regime — most small stores	Charges no VAT. Every line is recorded as VAT-exempt at its full value.
VAT-Exempt	Businesses the law exempts outright (for example, a BMBE or a co-operative)	Charges no VAT, and marks the receipt EXEMPT.

New stores start on Non-VAT (Percentage Tax). That is the safe default and it is correct for the majority of Kassly stores, but it is a default — not a guess about your registration. Check it.

VAT registration is not something you switch on because your sales grew. You are VAT-registered when the BIR says you are, on your 2303. Turning it on in Kassly does not register you, and turning it off does not deregister you.

Switching to VAT-Registered

Kassly will not let you save VAT-Registered until three things are on file under Store Information on the same page:

• Store Name
• Address
• TIN

Until they're filled in, Save Changes stays disabled and a warning tells you what's missing. This is deliberate: the VAT flag carves 12% out of your reported revenue and drives your BIR VAT declaration, so Kassly requires the identity that belongs on the paperwork before it will do that arithmetic.

What changes the moment you save

	VAT-Registered	Non-VAT / VAT-Exempt
VAT charged on a sale	12% on vatable items	None
How a sale is recorded	Sale net of VAT, plus Output VAT	Whole amount as a VAT-exempt sale
Revenue in your reports	Net of VAT (lower)	Full amount collected
Senior citizen / PWD discount	VAT removed first, then the statutory discount	Statutory discount on the gross price

Switching tax types changes future sales only. Sales already recorded keep the tax treatment they were rung up with — Kassly stores the VAT classification and VAT amount on each line at the time of sale, and never rewrites them. If you have been selling on the wrong setting, fix the setting and talk to your bookkeeper about the sales already in the books. Kassly cannot restate them for you.

The VAT rate and tax-inclusive pricing

Two more fields appear under Tax Settings — Tax Rate (%) and Tax Inclusive Pricing — but only once your store is BIR-accredited and set to VAT-Registered. Before accreditation they are hidden, because the receipt is not yet a BIR document and there is nothing for them to change on the printed copy.

• Tax Rate (%) — the Philippine VAT rate is 12%, and that is what Kassly computes with. Leave it at 12 unless your accountant tells you otherwise.
• Tax Inclusive Pricing — whether the prices you type into your catalogue already have VAT inside them.

Inclusive or exclusive, and why it matters

The difference is where the VAT sits relative to the price on your shelf label.

	Tax-inclusive (the usual choice)	Tax-exclusive
You set the price to	₱112	₱100
Customer pays	₱112	₱112
Kassly records VAT of	₱12	₱12
Net sale	₱100	₱100

Philippine retail convention is tax-inclusive: the price on the label is the price the customer pays, VAT already inside. Kassly defaults every new product and service to tax-inclusive for that reason.

The per-item setting is what actually decides. Each product and service has its own Tax Inclusive checkbox, and for anything in your catalogue that checkbox wins over the store-wide toggle. If one product's VAT looks wrong, check the product, not the store setting. See Product pricing.

VAT classification per item

Not everything you sell is necessarily vatable. Each product and service also carries a VAT Classification:

Classification	Meaning	VAT charged
Vatable (12%)	The normal case	12%
VAT-Exempt	Exempt goods — prescription medicines, certain agricultural produce	None
Zero-Rated	Zero-rated sales, typically export sales	None

Like the Tax Inclusive checkbox, these fields appear on the product and service forms only once your store is BIR-accredited. Everything defaults to Vatable and tax-inclusive until then.

What changes on your receipts

Your tax type changes the printed receipt, but only after your store is BIR-accredited. Until then, every receipt is a plain TRANSACTION RECORD with the line This is not a BIR invoice. at the bottom — regardless of your tax type. Kassly still computes the correct VAT numbers in the background so your books and reports are right; it just doesn't print BIR-regulated fields on a document that isn't yet a BIR document.

Once accredited:

Your tax type	On the receipt
VAT-Registered	VAT REG TIN, plus a breakdown of VATable Sales, VAT-Exempt Sales, Zero-Rated Sales and VAT Amount (12%)
Non-VAT (Percentage Tax)	NON VAT REG TIN, plus Sales Subject to Percentage Tax and Exempt Sales
VAT-Exempt	NON VAT REG TIN, plus a large EXEMPT label near the top of the receipt

See Receipt settings for everything else that prints, and BIR compliance for what accreditation involves.

Selling to a VAT-registered business

If you are VAT-registered and you ring up ₱1,000 or more of vatable items to a customer marked as a VAT-registered buyer, Kassly requires the buyer's full details before it will complete the sale:

• Name
• Business Style
• TIN
• Address

You'll get a clear error naming what's missing. This is not Kassly being fussy — without those four fields on the invoice, your customer cannot claim the input tax, and they will come back to you for a corrected copy. Fill them in on the customer record once and it never blocks you again. See Customer profiles.

The check only applies to customers you have explicitly marked as VAT-registered buyers. Walk-in sales and ordinary retail customers are never affected, at any amount.

Senior citizen and PWD discounts

Statutory discounts interact with your tax type, and the order of operations is set by law, not by preference.

• If you are VAT-registered and your prices include VAT, Kassly removes the VAT first, applies the statutory discount to the VAT-exclusive price, and marks the discounted lines VAT-exempt. This is the RA 9994 / RA 10754 treatment.
• If you are Non-VAT or VAT-Exempt, there is no VAT to remove, so the statutory discount comes straight off the price.

Kassly picks the right path from your tax type — there is nothing to configure. The discount rate itself depends on the class of beneficiary: 20% for senior citizens, PWDs and national athletes, 10% for solo parents. See Discounts.

A short checklist before your first sale

1. Tax Type matches your BIR 2303.
2. Store Name, Address and TIN are filled in if you're VAT-registered.
3. One test sale rung up and the receipt read end to end.

That third step catches more mistakes than the first two combined.