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      Tax Settings

      In this article, you will learn how to set up your tax model in SabeeApp account

      Setting Up Your Tax Model

      Choosing the correct tax model is crucial because it directly affects how your prices are calculated when you define them in the PRICES menu.

      Here's how a few different tax models work:

      1. Scenario 1: Price Includes VAT, No City Tax

        If your advertised price includes VAT and no city tax applies, select M08: GROSS - VAT.

        • For example, if your room price is €100, with 20% VAT included:
          • Guest pays: €100
          • Folio breakdown: €83.33 net price + €16.67 VAT

      2. Scenario 2: Price Includes VAT, City Tax Added On Top

        If your advertised price includes VAT but city tax is added separately, select M04: (GROSS - VAT) (GROSS - CITY TAX).

        • For example, if your room price is €100 per night (including 20% VAT) and the city tax is €2 per person per night:
          • Guest pays: €102
          • Folio breakdown: €83.33 net price + €16.67 VAT + €2 city tax per guest night

      3.  Scenario 3: Price Doesn’t Include Any Taxes:

      If your advertised prices does not include any taxes, but calculated on top, select M05: NET + (VAT + CITY TAX)

      • For example, if your room price is €100 per night, VAT is 20% VAT city tax is €2 per person per night:
        • Guest pays: €122
        • Folio breakdown: €100 net price + €20 VAT + €2 city tax per guest night

      Important Recommendation:

      We strongly advise using the same tax model in SabeeApp as you do in your other sales channels. This ensures consistency and prevents pricing discrepancies.

      By carefully selecting the tax model that aligns with your pricing structure and legal requirements, you can ensure accurate and consistent pricing across all channels.

      Available Tax Models

      SabeeApp offers various tax models to manage how VAT and City Tax are calculated and applied to your prices. When setting up your tax model for the first time, you’ll see all available options. Select the one that best matches your needs. If you need to change the tax model later, please contact your Account Manager. Here’s a detailed explanation of each model:

      Tax Models Overview:

      1. M01: GROSS - (VAT + CITY TAX)
        • Your prices in the PRICES menu are Gross Prices and include both VAT and City Tax.
        • For reservations (via Internet Booking Engine (IBE), OTAs, or manually uploaded), no additional tax is added to the price set in the Prices menu. However, VAT and City Tax are shown in the folio. Example: Price: 100.00 , VAT: 16.13, CityTax: 3.23, NetPrice: 80.65, GrossPrice: 100.00
      2. M02: GROSS - VAT - CITY TAX
        • VAT is deducted first from the gross price.
        • After deducting VAT, the remaining price is treated as gross, and City Tax is calculated and deducted from it. Example: Price: 100.00 , VAT: 16.67, CityTax: 3.21, NetPrice: 80.13, GrossPrice: 100.00
      3. M03: GROSS - CITY TAX - VAT
        • City Tax is deducted first from the gross price.
        • After deducting City Tax, VAT is calculated and deducted from the remaining amount. Example: Price: 100.00 , VAT: 16.03, CityTax: 3.85, NetPrice: 80.13, GrossPrice: 100.00
      4. M04: (GROSS - VAT) (GROSS - CITY TAX)
        • Your prices in the PRICES menu include VAT but exclude City Tax.
        • When a reservation comes in (via IBE, OTAs, or manually uploaded), City Tax is added on top of the price set in the PRICES menu. Example: Price: 100.00 , VAT: 16.67, CityTax: 3.33, NetPrice: 83.33, GrossPrice: 103.33
      5. M05: NET + (VAT + CITY TAX)
        • Your prices in the PRICES menu are Net Prices and exclude both VAT and City Tax.
        • For reservations (via IBE, OTAs, or manually uploaded), VAT and City Tax are added to the price set in the PRICES menu. Example: Price: 100.00 , VAT: 20.00, CityTax: 4.00, NetPrice: 100.00, GrossPrice: 124.00
      6. M06: NET + CITY TAX + VAT
        • Your prices in the PRICES menu are Net Prices.
        • City Tax is added first, followed by VAT. Example: Price: 100.00 , VAT: 20.80, CityTax: 4.00, NetPrice: 100.00, GrossPrice: 124.80
      7. M07: NET + VAT + CITY TAX
        • Your prices in the PRICES menu are Net Prices.
        • VAT is added first, followed by City Tax. Example: Price: 100.00 , VAT: 20.00, CityTax: 4.80, NetPrice: 100.00, GrossPrice: 124.80
      8. M08: GROSS - VAT
        • Your prices in the PRICES menu are Gross Prices and include VAT.
        • VAT is deducted, and the remaining amount is considered the net price. Example: Price: 100.00 , VAT: 16.67, NetPrice: 83.33, GrossPrice: 100.00
      9. M09: NET + VAT
        • Your prices in the PRICES menu are Net Prices.
        • VAT is added to the net price. Example: Price: 100.00 , VAT: 20.00, NetPrice: 100.00, GrossPrice: 120.00

      Key Differences Between Tax Models

      • M02 vs. M03:
        • In M02, VAT is deducted first, followed by City Tax from the remaining amount.
        • In M03, City Tax is deducted first, followed by VAT from the remaining amount.
      • M01:
        • VAT and City Tax are calculated based on the total gross price and deducted accordingly.

      Tax Models and Pricing:

      Gross Price Models (M01, M02, M03, M08):

      • Prices in the PRICES menu: Gross prices (including VAT and/or City Tax).
      • Reservations: No additional tax will be added to the price received from your IBE, OTA, or manual entries.

      Net Price Models (M05, M06, M07, M09):

      • Prices in the PRICES menu: Net prices (excluding VAT and City Tax).
      • Reservations: SabeeApp will calculate and add VAT and/or City Tax based on the selected tax model.

      Hybrid Model (M04):

      • Prices in the PRICES menu: Gross prices (including VAT but excluding City Tax).
      • Reservations: SabeeApp will add City Tax to the price received from your IBE, OTA, or manual entries.

      Setting up VAT and City Tax:

      Once you have selected the correct Tax model, you need to define the VAT and City tax:

      Default VAT:

      This is the basic tax for accommodation services defined by your tax authorities.

      Local Resident VAT:

      Local residents might be subject to a different VAT or VAT might not apply to them at all. You can specify this information in this field.

      Apply City Tax for Non-locals:

      You can separately calculate City Tax for clients who are not from your property's country of origin.

      Apply City Tax for Locals:

      You can separately calculate City Tax for clients who are from your property's country of origin.

      City Tax Calculation:

      You can specify the calculation of city tax here. It can be based on a Percentage, Fixed - per person, or Fixed - per room.

      If you have multiple city tax rates for different locations (commonly seen with apartment rentals), ensure that you set the default city tax rate here. For more details on how to configure city tax rates specific to room types, please refer to the room-type-based city tax settings help article.

      City Tax Amount:

      You can define the exact amount or percentage of your City Tax here.

      After finalising your tax settings, you can choose one of two options:

      1. Apply to Future Reservations (Including Existing Bookings with Future Arrival Dates):
        • Click the "Update and Apply for Future Reservations" button.
        • This will apply the new tax model or changes to: Existing reservations already in the system with an arrival date in the future (starting from tomorrow) and all new bookings made after the changes are saved.
      2. Apply Only to New Reservations:
        • Click the "Update and Don't Apply for Existing Reservations" button.
        • The new tax settings will apply only to reservations that are made after the changes are saved. Existing bookings will remain unaffected.
        Once the changes are applied, this menu will be locked for 2 hours. You will be able to modify it again after the lock period ends. This ensures flexibility based on how you want the tax changes to be implemented.