Overview: Taxes

The content of this page is specific to the Delphi product type. If you are using the Delphi Core product type, click here to access the Delphi Core-specific online help.

The information in this topic applies to the enhanced taxes feature available with version R21 and higher. If you are not using enhanced taxes, refer to Overview: Taxes and tax groups. You need to be an administrator to create or edit a tax group.

Correct taxes are important for banquet check and booking check calculations. Administrators need to ensure that the property's taxes for menus and items, function room rental, other income, and guestrooms comply with state and local laws.

A tax group is a collection of taxes that are managed together from one central location. Use the Tax Collection Configuration section of the Tax Group page to edit and update the taxes that apply during the tax group’s date range.

For example, most of the events at your property are subject to a state sales tax of 4.0% and a local sales tax of 4.5%. Rather than manually applying those taxes to each menu and item at your property, you can create a Default Tax Group. Then, add the taxes to the group, and assign that tax group as the default for your property. When a user creates a new event, the Default Tax Group defaults on to the event and the appropriate taxes are automatically calculated when the banquet or booking check is merged.

If the property's default tax group is not applicable to a certain event, the user can select a different tax group for this event only. For example, you might also have a Tax Exempt Group that is used for non-profit organizations, where only one or no tax is charged.

The advantages of Tax Groups

• Updates can be made from one central location. When your tax rates change, you can clone the existing tax group and enter a new effective date range. When you are ready to use the new tax group, assign it to your property. All bookings within the tax group's effective date range are then taxed accordingly. If a record is not within any tax group's date range, a message displays at the top of the Booking page along with a warning icon next to the record. Select the correct tax group for the record and save again. See All about taxes to learn more.
• Alignment with revenue classifications. You can have some taxes in a tax group that apply only to certain types of revenue. When you add a tax to a tax group, you associate the tax with one or more revenue classifications. Since menus and items are also associated with revenue classifications, the tax that applies is controlled by the matching revenue classifications. For example, if you have an audio visual tax of 5.0%, only items with a revenue classification of Audio Visual are subject to that 5.0% tax.
• Guestroom taxes can apply as a percentage or a flat rate. Your tax groups can include guestroom taxes as a percentage or a flat occupancy rate. Those taxes automatically apply to all guestroom blocks and display on the booking check.
• Gratuity and administrative charges are automatically taxed. The taxes in a tax group can apply to the base price of a menu or item, the gratuity, and the administrative charge. The tax that applies is controlled by the matching revenue classification. For example, your breakfast is 12.95 per person and subject to an 18.0% gratuity charge, based on the Food revenue classification. Your 4.0% local sales tax applies to the base price of a Food menu and its gratuity. When that menu is added to a booking event, the 12.95 base price and the 2.33 gratuity are automatically taxed at the 4.0% rate.

  If a menu has items from multiple revenue classifications, its revenue breakdown indicates which amount of the total menu price needs to go to each revenue classification. For example, your full-service menu is 95.00 per person. The menu includes all food, beverage, and audio visual and is allocated as follows: 55 to Food, 30 to Beverage, and 10 to Audio Visual. This menu is associated with three different revenue classifications, each of which might be taxed differently.

• Merge document updates are not required. No changes to merge document templates are required with enhanced tax groups. Only the name of the tax and the tax rate display on the booking check and the banquet check. The name of the tax group and tax collection are not shown. Each tax displays as a separate line item. If you have multiple taxes of the same type, name, and rate, those taxes display as a single line item, with their values combined.

The Tax Group page is divided into the following areas:

Tax group details
Property	This is the name of the property with this tax group.
Name	This is the name of the tax group. This is for internal purposes only and does not display on the banquet check or booking check.
Active	This is the status of the tax group. Leave this checkbox selected to ensure correct taxes on the banquet check and booking check.
Description	This is a brief description of the tax group. This is for internal purposes only and does not display on the banquet check or booking check.
Start Date and End Date	This is the effective date range of the tax group. If a new or modified booking is not within the tax group's date range, a message displays at the top of the Booking page. A warning icon also displays next to the record in the Manage Events or Manage Guestrooms grid.
Tax collection configuration details
Percent tab	This displays all the tax collections defined for this tax group. A tax collection includes all the taxes that apply to the same revenue classifications. All properties have at least one collection for their base taxes. Your property might have additional tax collections, for example, a liquor tax. Select a tax collection to see the individual taxes it contains. Tax collections only refer to taxes with percentage rates.
Tax Collections	This area displays the tax group's existing taxes.
Occupancy tab	This displays the flat rate taxes for the guestroom revenue classification only, for example, a per roomnight occupancy tax. Any amounts entered here are not used with inclusive pricing.
Occupancy Taxes	This area displays the tax group's existing occupancy taxes.
Taxes tab	This displays individual taxes, along with the rates and the following information. Base – The tax only applies to the item but not to gratuity or the administrative charge. Admin - The tax applies to the item and the administrative charge. Gratuity - The tax applies to the item and the gratuity. Compound - The tax applies to a revenue value that includes previous taxes. Taxes compound in the order they display in the tax collection. If needed, you can reorder the taxes. Inclusive - The tax is included in the price of the menu or item. The exclusive price is calculated by deducting the tax from the inclusive price. Both prices display to users in the application. In addition to menus and items, inclusive pricing can also be used for function room rental, guestrooms, other income, and packages. Inclusive pricing is available with version R21 and higher and needs to be enabled by an administrator.
Applies To	This displays all the corporate and property revenue classifications available at your property. Select each checkbox to associate the tax with all applicable revenue classifications. Revenue Classification - This displays property and corporate revenue classifications available for the property. Assigned Tax Collection - This displays the current tax collection assigned to the corresponding revenue classification.

Additional requirements

To use the enhanced taxes feature, you need to do the following:

1. Add any additional revenue classifications.
2. Enter the default gratuity and administrative charge for every revenue classification.
3. Set up your tax groups.
4. Assign a default tax group on the Property Detail page.