Sales Tax on Orders
When you confirm a sales order you raised by hand, Iraca asks how it should be taxed and works out the tax for you. The answer is recorded on the order and doesn't change afterwards.
Setting your rate
Iraca uses one sales tax rate for your whole business — the same one the register uses. Set it in the Sales tax card on the main Settings page, entered as a percentage (for example 8.25 for 8.25%). Every account has it, whether or not you use the register.
If you haven't set a rate, orders confirm with no tax and the dialog tells you so.
Choosing how an order is taxed
Click Confirm on a draft sales order and you'll be asked for a tax treatment, with a running Subtotal / Tax / Total so you can see the effect before committing:
- Taxable — the default. Tax is charged at your rate.
- Exempt — certificate on file — no tax. Enter the customer's resale certificate number and issuing state.
- Exempt — certificate to follow — no tax, but you still need the paperwork. Iraca records a date 30 days out so you can chase it.
A certificate is saved against the customer, so you only enter it once. The next order for that customer can be marked exempt without retyping it.
If the order has no customer attached, an exemption still applies — there's simply no customer record to file a certificate against.
Setting a customer's exemption once, instead of every order
If a customer is always exempt, say so on their contact record rather than remembering at every confirmation. Open the customer from Contacts, and set Sales tax:
- Not set — charge tax — the default, and what every existing customer has. Nothing changes.
- Always charge tax — the same outcome, but a decision somebody made rather than one nobody got to.
- Exempt — certificate on file
- Exempt — certificate to follow
From then on, confirming a manual sales order for that customer starts on their setting, and the confirm dialog says where it came from. You can still override it for a single order — the dialog tells you when you have, so a one-off doesn't look like a permanent change.
This is the fix for the most expensive small mistake
Before this, a permanently-exempt distributor had to be marked exempt on every single order. One forgotten order charged them tax they don't owe, and you find out when they dispute the invoice.
Two limits worth knowing. It's offered on wholesale customers only — a consumer who checked out on your storefront isn't reselling anything — and it never touches marketplace orders, which are taxed by the platform that collected the money.
Setting an exemption also means Iraca refuses to switch that customer to retail until you clear it, for the same reason it refuses while a credit limit is set: losing it silently starts charging someone who doesn't owe.
Keeping the certificate itself
A certificate number isn't what an auditor asks for — the certificate is. Under Certificates on file, each row has Add document (or Replace) to attach the PDF or a photo of it, up to 10 MB.
These are stored privately, unlike every other file in Iraca
Product images and logos sit at public URLs, which is fine for a product photo. A resale certificate carries your customer's tax ID, so it is stored where nothing serves it directly: the only way to read one is through Iraca, signed in. There is no link you can paste to someone.
Replacing a document removes the previous one. A certificate has one current document, and keeping superseded copies of a customer's tax paperwork isn't something to do by default.
Letting your customer send it in
Your customer is usually the one holding the certificate — often before you've recorded anything. From Account in the portal they can send it to you directly: number, state, expiry and the file.
Sending is not the same as being exempt
A submission arrives as Awaiting review and changes nothing about what that customer is charged. Approving it is what grants the exemption. That separation is the point — otherwise anyone with a portal login could stop being charged tax by uploading a file.
You'll find submissions under Sent in by customers on the resale certificates page, with the document to open and two choices:
- Approve — the certificate goes on file. The checkbox above the list also marks that customer tax exempt, which is usually what you want; turn it off if you only meant to file the paperwork.
- Reject — a reason is required, and your customer sees it. "No" on its own just produces another email and another guess at what was wrong.
A customer can have one submission waiting at a time, and can send a new one once you've decided.
What your customer sees
A customer signed in to the portal can see the exemption you hold for them, the certificate numbers, the expiry dates, anything still awaiting review, any rejection and its reason, and can download the documents from Account.
They can't edit or replace what you've already accepted. A certificate the customer could swap without you looking at it wouldn't substantiate anything at an audit — a replacement goes through the same review.
Certificates that expire
Your certificates are listed under Certificates on file on the resale certificates page, soonest to expire first, and an expired one is flagged in red.
An expired certificate does not switch the customer back to taxable
Iraca tells you and leaves the decision to you. Flipping a customer to taxable because a date passed would change what they're charged with nobody choosing it — and the right answer is usually to get a renewed certificate, not to start charging tax.
Chasing the certificates you're still owed
Marking a sale Exempt — certificate to follow means you charged no tax on a customer's word. Until the certificate arrives, that exemption isn't documented — and an exemption you can't substantiate is tax you owe out of your own pocket, on a sale where you collected none.
Iraca keeps the list for you. When anything is outstanding, a Resale certificates card appears on your dashboard showing how many exemptions are undocumented, how many are past their 30-day date, and roughly how much tax is at stake. Open it for the full list.
The list covers both order and register sales, worst first, and shows for each one the customer, when the certificate was due, how many days late it is, and the estimated tax. That estimate uses your current rate — the sale itself recorded a rate of zero, so there's no historical rate to reconstruct. Read it as "roughly how much is undocumented", not as an amount owed.
When a certificate arrives, choose File certificate, enter the number and issuing state, and the sale becomes fully exempt and drops off the list. Filing changes no money — the sale charged no tax and its total doesn't move. You're recording the paperwork, nothing else. The certificate is saved against the customer, so filing it once covers their other sales too.
There's deliberately no way to dismiss an item without filing a certificate. The exposure is real until the paperwork exists, and a dismiss button would hide exactly what this list is for. If a customer turns out not to be exempt after all, that's a correction to the sale rather than something to clear from here.
A sale with no customer on it can't take a certificate, because a certificate is filed against a customer. Add the customer to the sale first.
The rate is fixed at confirmation
This is the part worth understanding. Confirming an order locks in the rate that applied at that moment.
If you later change your rate — say from 8.25% to 9% — orders you already confirmed keep the tax they were confirmed with. Only new confirmations use the new rate.
That's deliberate: confirming is the point where you quote a customer a price. A rate change shouldn't quietly restate an order they've already agreed to, or an invoice you've already sent.
Tax on a service charge
A catering service charge works the same way as the delivery fee: it's added to the goods before the tax is worked out, it's taxed by default, and you can turn off Charge sales tax on service charges in the Sales tax card on the Settings page. The choice is locked in at confirmation, and the order page labels the row Service charge (not taxed) when it was confirmed untaxed.
Tax on a delivery fee
If an order carries a delivery fee, whether it's taxed depends on your state, so it's your call. Iraca taxes it by default. To change that, turn off Charge sales tax on delivery fees in the same Sales tax card on the Settings page.
When it's on, the fee is added to the goods before the tax is worked out — $50.00 of goods and a $15.00 fee at 8.25% is $5.36 of tax, not $4.13 — and the confirm dialog shows you that before you commit.
Like the rate, this is locked in at confirmation. Turning the setting off later doesn't change the tax on an order you already confirmed; only orders you confirm afterwards follow the new setting. The order page labels the fee Delivery (not taxed) when it was confirmed untaxed, so you can always tell which rule an order was quoted under.
Where the tax shows up
Once an order carries tax, the line items table breaks the total out:
| Subtotal | $50.00 |
| Tax (8.25%) | $4.13 |
| Total | $54.13 |
The Total and the amount due from the customer both include tax. Revenue does not — tax you collect isn't income, it's money you're holding on someone else's behalf.
The same breakdown appears on the order confirmation you email or download, and in the email itself, so the customer sees the subtotal, the tax and the total they actually owe rather than one combined figure they can't check.
When the order is fulfilled, Iraca books the tax to a Sales Tax Payable account, a liability that sits on your books until you remit it. The customer's receivable is the goods plus the tax, because that's what they owe you.
Orders that are never taxed here
- Marketplace orders (Amazon, Walmart, Etsy, WooCommerce, TikTok, Shopify) — the platform already collected tax at checkout and remits it itself. Charging again would bill the buyer twice and put a liability on your books that isn't yours.
- Purchase orders — money going the other way. Tax a supplier charges you arrives on their bill.
- Orders confirmed before this feature existed — they were quoted without tax and are left exactly as they were.
Filing and remitting
Iraca calculates and records tax. It does not file returns or remit on your behalf — that stays your responsibility. The Sales Tax Payable balance in your reports is what you've collected and not yet handed over.