Get Started with Tax Exemption Rules
About tax exemption rules
You can create tax exemption rules based on dining options, item price, or total price of items and apply them accurately and automatically on the Square Point of Sale app. You can apply tax exemption rules to custom amounts, individual items, or an entire category of items. When the threshold conditions are met, the exempted items do not have the tax rate applied.
Conditional tax rules are preset conditions where taxes aren’t applied, and you can apply a conditional tax rule to all items in a cart or to individual items. Dining options and tax rules work together, so a tax rule applies to a sale based on how the linked dining option is applied to the sale — either to the entire cart or to a specific item.
Before you begin
You can create and edit tax exemption rules through your Square Dashboard.
To apply exemption tax rules correctly at checkout, make sure the Square Point of Sale app on your devices is up to date.
Tax rules only apply to the items in a cart. You cannot set tax rules for item modifiers. To apply exemption tax rules to dining options, set up your dining options first. Learn how to use dining options with the Square app.
Add tax exemption rules
You can add tax exemption rules through your Square Dashboard.
Sign in to your Square Dashboard and select Settings > Account & Settings > Payments > Sales taxes.
Under Sales taxes, select the tax you want to add an exemption rule to.
Toggle on Add exemption rule to specify when the tax should not be applied.
Enter the name of the rule and the locations where it applies.
Choose one condition: If item price is below an amount, If total price is below an amount, or If dining option is used.
If you select If item price is below an amount or If total price is below an amount, enter the threshold amount in Amount. If you select If dining option is used, select the dining options that apply.
Select Items exempt from tax, choose the items to exempt from your Item Library, and select Done.
If you want to apply the rule to custom amounts, toggle on Apply exemption to custom amounts.
Select Save.
Edit tax exemption rules
You can edit, disable, or delete your tax exemption rules from your Square Dashboard. By disabling a tax, the tax will no longer be applied to purchases. You can enable a tax again by following the same process. Deleting a tax removes the tax from your Square account and cannot be undone.
Sign in to your Square Dashboard and select Settings > Account & Settings > Payments > Sales taxes.
Under Sales taxes, select the tax rule you want to edit.
To edit the rule, update the fields you want to change and select Save.
To disable or delete the tax, select Actions and choose Disable tax or Delete tax.