Configure Tax Settings

Law firms meet jurisdictional tax requirements by applying the correct tax to billable work and expenses instead of calculating it manually on every bill. Clio Manage lets your firm set a primary and a secondary tax rate, choose whether each applies to bills by default, and apply or remove tax on an individual bill or line item. The result is a bill that carries the right tax for your jurisdiction without manual correction.

Understand tax rates

Your firm can create up to 15 tax rates. Each rate is available to select when you create an expense entry or generate a bill, and you can specify whether a rate calculates on pre-tax or post-tax totals when more than one rate applies. Expenses can also record separate vendor and client tax values. See Record and Manage Expenses.

Add tax rates

1. Go to Settings > Billing > Taxes.
2. Click Add a tax rate.
3. Enter a unique name and the tax rate, using up to four decimal places.
4. Select the country and state or province where the tax applies.
5. Click Create tax rate.

Edit or delete tax rates

You can delete any tax rate that is not set as the default, not added to a time or expense entry or category, and not on an unpaid invoice.

Edit a tax rate

1. Go to Settings > Billing > Taxes.
2. Click the edit (pencil) icon next to a tax line item.
3. Update the name, tax rate, country, and/or state or province.
4. Click Edit tax rate.

Delete a tax rate

1. Go to Settings > Billing > Taxes.
2. Click the delete (trash can) icon next to a tax line item.
3. Click Delete to confirm the action.

Set default tax rate

Invoice tax defaults are the rates Clio Manage suggests on new bills. You set them on the same General tab that holds your other bill settings.

1. Go to Settings > Billing > General.
2. In the Invoice tax defaults section, enter your firm's tax number.
3. Click the down arrow under Choose a default tax rate for your invoices and select a tax rate you added.
4. To apply more than one default, click + Add an additional tax default and select the additional rate.
5. Check Enable recording of input and output taxes on disbursements if your firm tracks VAT on disbursements.
6. Scroll to the bottom and click Save changes.

Apply tax by activity category

You can set a default tax treatment on each activity category so related activities carry consistent tax. See Set Up Activity Categories.

Apply or remove tax on a bill

On a draft or pending bill, you can change which tax rates apply to the whole bill or to a single line item.

1. Go to Billing and open a draft or pending bill.
2. Click Edit.
3. To change tax on the whole bill, click Edit tax and select or clear the tax rates.
4. To change tax on one line item, update the tax setting in that entry's tax column.
5. Click Save invoice.

Manage tax exemption

If your firm is exempt from sales tax, send your tax exemption certificate to tax@clio.com for processing.

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