This guide covers how to apply and manage tax in your Projects, Schedules and Invoices. If you haven't set up your tax rates yet, start with [How to set up and manage tax rates] first.
⚠️ Connected to QuickBooks or Xero?
When your accounting integration is active, Programa automatically limits your available tax rates to those synced from QuickBooks or Xero. Custom rates created in Programa are not available for selection while the integration is connected. Any custom rates you created before connecting will be automatically archived. They'll still appear on existing invoices and schedules, but won't be available going forward unless you disconnect the integration.
Action required: If you have schedules created before syncing your accounting integration, any products with custom tax rates applied will need to be remapped to your synced rates before you can generate invoices from them.
Applying tax rates at Project level
Once your tax rates are configured at Studio level, you can assign them to individual projects.
Prerequisite: You must have a default tax rate selected in your Invoice Settings before applying tax at project level.
Click the 3-dot icon on your project card and select Settings.
In the Details tab, scroll to Tax Preferences and toggle on the Tax switch.
From the dropdown, select which tax rates to apply. You can select multiple rates if more than one applies.
Choose whether pricing in your Schedule should be calculated inclusive or exclusive of tax.
Click Save.
Schedule-level tax controls
With tax configured at Studio and Project level, you have granular control over tax at the individual line item level in your Schedule.
Enabling or disabling tax per item
In the Financials tab of your Schedule, each product has a Tax field. When tax is enabled for the project:
Items default to being taxable using the project-level tax rate(s)
You can update individual items to non-taxable as needed
When you disable tax on an item, any custom tax settings for that item are automatically cleared
To use the Tax Controls button:
Navigate to the Financial tab in your Schedule.
Click the tax field next to a product to open the tax widget.
Enable or disable the tax settings as needed.
Selecting specific tax rates per item
If your project has multiple tax rates configured, you can choose which specific rates apply to each individual line item
Click the tax dropdown on any line item in the Financials tab.
You'll see a list of all tax rates configured for the project, each with a checkbox.
Check or uncheck rates to control exactly which ones apply to that item.
The dropdown stays open while you make selections, so you can adjust multiple rates without reopening it.
Each tax rate shows its source (e.g. Studio rate, QuickBooks rate) so you know where it came from.
⚠️ QuickBooks or Xero users: If you're connected to QuickBooks or Xero, only your synced rates will appear in this dropdown - custom rates are not available while the integration is active.
Section headers with tax breakdowns
Schedule section headers display a tax summary for everything within that section:
Total client price (exclusive of tax)
Total tax amount for the section
Total inclusive amount
A count of items with custom tax (e.g. "2 items with custom tax") when applicable
These totals are calculated per section, making it easy to review tax at a glance.
Visual indicators for custom tax
Items with a tax configuration that differs from the project default are flagged with labels:
Tax - Modified — specific tax rates were selected that differ from the project default
Tax - Project — the item follows the project default (no tax applied for that item)
How tax calculations work
Tax applied before entering products
When tax is configured at project level before products are added to your Schedule, the inclusive or exclusive setting determines how pricing displays from the start.
Exclusive: Tax is calculated on top of the product cost.
Inclusive: The product cost already includes the tax component.
Tax applied after entering products
When tax is added to a project after products are already in the Schedule, the calculation fields on your products will update to reflect the new tax setting.
Note: See the examples below for a visual comparison of inclusive vs. exclusive pricing with a 10% tax rate applied before and after product entry.
Tax and markup
Tax and markup work independently. Your markup total is based on the markup percentage you've applied to the original product cost. Whether markup is active or not, the tax rate applies to the original cost — you cannot add markup on tax.
How tax is displayed to clients
When your client has access to your Schedule pricing via the Client Dashboard, the tax component appears against each line item in the Financial tab. Prices will indicate whether they are inclusive or exclusive of tax.
Applying tax to invoices
When creating invoices, your project and Schedule-level tax settings carry over automatically, with additional controls available.
Invoice-level tax rate
When creating or editing an invoice, you can select a custom tax rate at the invoice level:
The tax rate dropdown shows all tax rates configured in your Project settings
Select the rate(s) that should apply to the invoice as a whole
This only sets the default tax rate for the invoice. If you update this after adding line items, it will only apply to subsequently added line items — it won't update existing line items.
Line item tax controls
Each line item on an invoice has its own tax setting which is either taken from the Invoice Tax Rate (per above) or customised as needed:
Invoice Tax rate - When added, the line item uses the tax rate selected at the invoice level.
No tax for this item - The item is tax-exempt
Custom - You can customise tax applied at individual line item level within the invoice.
This gives you the flexibility to set the applicable tax rate (or not) for specific products or services as needed.
Tax rates flowing from Schedules to Invoices
When you add line items by selecting products from a Schedule:
If a Schedule item was marked as non-taxable, it will appear as non-taxable on the invoice.
If a Schedule item had specific tax rate selections, these are respected when the item is added to the invoice.
You can still override any tax setting on the invoice after items are imported.
This ensures consistency between your Schedules and Invoices, reducing manual re-entry and the risk of tax calculation errors.
QuickBooks and Xero: tax rate syncing on invoices
If you've connected Programa to QuickBooks or Xero, your tax rates are kept in sync:
Syncing Tax Rates
When you integrate against QuickBooks or Xero, you can sync tax rates created in either of these systems.
QuickBooks or Xero tax rates imported into Programa show their source, so you always know where a rate originated
🚨 Important reminder: When your QuickBooks or Xero integration is active, Programa automatically limits tax rate selection to rates synced from your accounting platform. Custom rates created directly in Programa are not available for selection while the integration is connected.
If you're seeing tax rate mismatches in QuickBooks or Xero after syncing, check that all line items are using synced rates only. See [How to set up and manage tax rates] for how to sync rates from your accounting platform into Programa.
Managing QuickBooks Tax Rates
You can now archive or delete QuickBooks-synced tax rates directly from Programa's Tax Settings
Archived QuickBooks rates remain on previously applied projects but won't appear for new use
What happens to your existing custom rates
If you had custom tax rates in Programa before connecting QuickBooks or Xero, those rates are automatically archived when the integration syncs. Archived rates will still appear on any invoices and schedules they were previously applied to - your historical records are preserved. They won't be available for new use unless you disconnect the integration.
⚠️ Action required: For any schedules created before the sync where custom tax rates were applied to individual products, you'll need to remap those items to your synced rates before creating invoices from them. Open the schedule and update the tax rate on each affected product.
Setting up tax rates for Purchase Orders
Before creating a Purchase Order, you'll need to configure tax settings specific to your Purchase Order workflow.
Select the cog icon at the top right of your Purchase Order Dashboard (next to the 'Create order' button).
Click + Add Tax Rate.
Enter the tax Rate.
Select a Tag.
Enter a Display name and Description.
Click Add Tax Rate to save.
Frequently asked questions
Can I apply tax to some products and not others?
Yes. In both Schedules and Invoices, you can toggle tax on or off for individual line items. In Schedules, you can also select specific tax rates per item . Please note though, if you have a QuickBooks or Xero integration connected, custom tax rates are not available - only synced rates from your accounting platform can be selected.
If a supplier hasn't specified whether a product is inclusive or exclusive of tax, which should I choose?
Add the product as exclusive of tax so you can apply the tax component later if needed.
Can I use multiple tax rates on a single Schedule item?
Yes. If your project has multiple tax rates configured, you can check/uncheck which rates apply to each individual line item in the Schedule's Financials tab.
Can I use multiple tax rates on a single Invoice?
Yes. Individual line items can either use that default invoice rate(s), a different project tax rate(s) or be marked as tax-exempt.
Do custom tax rates sync with QuickBooks or Xero?
No. Only synced tax rates from QuickBooks or Xero will be synced back to the corresponding platform when used in an Invoice.
Will my Schedule tax settings carry over to Invoices?
Yes. When you add items from a Schedule to an Invoice, the tax/non-tax status of each item is preserved. You can still override these settings on the invoice if needed.
How will my client know if items are inclusive or exclusive of tax?
If you've shared a live Schedule with pricing access, clients will see the tax rate applied against each product, along with a "Pricing inclusive" or "Pricing exclusive" indicator next to the Schedule totals.
How does tax affect existing projects that don't have tax applied?
Existing projects have the tax component turned off by default. To add tax, first set up your tax rates in Settings > Invoicing > Tax Settings. If you try to add tax directly to a Schedule item before configuring this, you'll be prompted to set it up first.
Need more help with tax? Contact our support team via live chat for personalised assistance.