# Tax Class

Tax Class maps sale and purchase tax combinations for regular, nil-rated, and exempted items by region.

On this page

Overview List View Form Fields How It Works Actions FAQ Related

Overview

Go to Accounts → Settings → Tax Class from the left menu. Master data screens do not use Master Update — edit records directly from the list or view.

List View

List columns `Id`, `Name`, `Description`, `Status` Header actions: New Row actions: edit, delete, view

Form Fields

| **Field** | **Description** | |-----------|-----------------| | (see below) | Exact labels from the create/edit form | Create / edit fields Basic: Name *, Rate Type (Regular, Nil Rated, Exempted), Description. Sale Taxes: Taxes, Intra State Taxes, Inter State Taxes, Export Tax, GCC Export Tax. Purchase Taxes: Taxes, Intra State Taxes, Inter State Taxes, Import Tax, GCC Import Tax.

Which fields appear depends on the company country — India shows Intra State and Inter State taxes, other countries show the general Taxes field, and Bahrain adds the GCC Export/Import fields. Each mapping points to individual Taxes, not tax groups.

Form buttons: Save, Update, Reset, Cancel (as applicable)

How It Works

Item tax classification

Tax Class is assigned on items — inventory items, service items, and asset items — to classify how tax should apply. It is not assigned on customers or suppliers. Rate Type distinguishes Regular (taxable at standard rate), Nil Rated (zero-rated), and Exempted (no tax).

Which taxes apply

Each tax class defines separate tax mappings under Sale Taxes and Purchase Taxes for different supply types:

On a transaction line, the system compares party location and supply type against the item's tax class to pick the correct mapping, which points directly to individual Taxes. Changing a tax class affects new transactions; existing approved documents keep their posted tax until edited.

Connected reports: Tax Report, Bill Wise Tax Wise Purchase, GSTR1, GSTR2, Tax Report India.

Actions

| **Action** | **Where** | **Description** | |------------|-----------|-----------------| | New | List | Opens create form | | edit | List, View | Opens edit form | | view | List | Opens read-only view | | delete | List, View | Removes the record | | Suspend / Activate | View | Disables or re-enables the record | | Print | View | Prints the tax class |

FAQ

What is tax class used for?
It classifies items for tax treatment and points each supply type to the individual taxes that should apply.

Where is tax class assigned?
On items only — inventory items, service items, and asset items. It is not set on customers or suppliers.

Does a tax class use tax groups?
No. A tax class maps directly to individual Taxes for each supply type (intra/inter state, export/import, or general taxes).

Can I change class on posted bills?
Not retroactively. Update the item master so future transactions use the new class.

Why do I see different fields by country?
India shows Intra/Inter State taxes; other countries show a general Taxes field; Bahrain adds GCC Export/Import taxes.