Tax-Inclusive Pricing

This article goes over tax-inclusive pricing, how to enable it in your school, and how it applies to your transaction reports.

CAUTION: These are general recommendations. Teachable cannot give tax or financial advice and is not liable for any losses or tax liabilities due to actions taken (or not taken) based on these recommendations. Always consult a local tax professional when planning your taxes.

Overview

For schools on Teachable, tax-inclusive pricing offers the ability for school owners to set the price of a product with the tax already included within that price. This means that all students, regardless of location and applicable taxes, will see the same final sale price.

When tax-inclusive pricing is disabled, students see the price of the product with the tax added on top of the product’s listed price from the pricing block (when applicable). This is also known as tax-exclusive pricing.

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Enable/disable tax-inclusive pricing

To enable/disable tax-inclusive pricing:

  1. Navigate to the Settings > Taxes area of your school admin
  2. Go to the Include taxes in all prices section
  3. Toggle the option on (to enable tax-inclusive pricing) or off (to disable tax-inclusive pricing).
  4. A pop-up will appear asking to confirm your choice. Click Confirm.

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NOTE: Enabling tax-inclusive pricing will only apply to new sales. Students with existing payment plans or subscriptions will continue to be taxed as they were at time of purchase.

Reporting

Within the Sales > Transactions area of your school admin, click on a sale and view the Transaction Summary. At the top of the summary, you can view whether a sale was tax-inclusive or tax-exclusive at time of purchase.

Additionally, when downloading a Transaction Report CSV, the column labeled tax_inclusive will indicate whether the transaction was tax-inclusive (TRUE) or tax-exclusive (FALSE) at time of purchase.

Student experience

For your students, the experience of purchasing a product with tax-inclusive pricing enabled versus not-enabled is the same. The difference is in how the student will see the price listed on the sales page and how the tax will be applied on the checkout page, when applicable.

While the tax-inclusive pricing toggle is enabled, a student, regardless of location, will see the final sale price as the price set in the Pricing tab of your product.

If tax-inclusive pricing is disabled, students from different countries will see the sale price differently based on the applicable taxes in their region.

NOTE: If disabled, students in the EU/UK will not see tax displayed on the sales page of a product as part of the total sale price, but will see tax displayed at checkout as a separate line item. Learn more about VAT on Teachable.

Frequently asked questions

What is the difference between tax inclusive, tax exclusive, and tax exemption?

Tax inclusive means the price set in the Pricing tab of a product is the final sale price. If a student is charged tax, it will be subtracted from the final sale price. This does create variability in earnings as each country sets its own tax percentage.

Tax exclusive means the price set in the pricing tab is the price before tax is added at checkout. Students will see tax added on top of the product’s price when applicable. This makes your earnings a bit more consistent, but does increase a product’s final sale price in different countries based on that county’s tax percentage.

Tax exemption means that the sale, which normally would be taxed, does not have any tax applied during checkout. This is determined either by the school or student’s tax-exemption status. If you or your student are tax-exempt, please contact Customer Support to submit tax-exemption documentation.

How will this affect my existing students who are on payment plans or subscriptions?
Existing students with active plans will not be affected by enabling tax-inclusive pricing. They will continue to see tax applied on top of the product price, when applicable.
Why are my earnings different?

The tax percentage of a product is determined by the location of the student at time of purchase. Each country has its own tax percentage, which is calculated towards the total sales price.

For example, a school has a course set at $100 with tax-inclusive pricing turned on. A student who lives in Country A and a student who lives in Country B both purchase the course for $100. Country A has a tax rate of 10% while Country B has a tax rate of 20%. That means the possible earnings from the first student would be $90, while the possible earnings for the second student would be $80.

What types of taxes are being added to my products?
When applicable, a product is taxed based on the student’s location. Read more about taxes on Teachable.

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