This article will walk you through the process of applying taxes and fees to your reservation sources and adding taxes and fees to items and services.
Once created, taxes and fees can be mapped/added/applied to different sections or item categories:
- Reservation Sources: Once applied, these taxes and fees will be automatically added to the reservation rates sent to these sources.
- Distribution Channels (OTAs): As part of your Reservation Sources.
- Reservations: On top of the reservation rates.
- Items and Services: Apply your taxes and fees to the applicable items and services offered at your property
- To apply a tax/fee to reservation sources, this tax/fee must be created in advance. See Create, edit or delete taxes and fees. Also, learn more about the different Types of taxes and fees
- Property Owner has access to the Sources settings by default. The rest of the users can be granted permission to Sources by the Property Owner. Learn more about Roles and Permissions
- Go to the Property tab within your Account Settings
- Click on Sources
- Select the source type: Primary Sources or Third Party Sources
- Next to the source click Configure Taxes/Fees For Source. In example below, the tax will be applied to source Website/Booking Engine, meaning that the tax will be added automatically to all reservations created when selecting Booking Engine as a source.
- Select the Tax or fee to be applied to the source from the drop-down list
- Click Save. When creating a reservation and selecting the source (Booking Engine, in this example), the tax will be automatically added and calculated.
If the tax/fee to be applied has not been created yet, click on Create/Modify Tax or Fee to go directly to the Taxes and Fees page.
If you have any future reservations with this source, the system will ask you whether to recalculate the reservations. See the section below for more details.
Recalculate existing reservations for future dates
If you applied a tax to a source which you have reservations in the future, the system will suggest you to recalculate these reservations:
- If YES is selected: The tax will be applied based on the current date of the reservation, not the status. Meaning that, the tax is applied only to room rate charges that are pending to be posted in the folio, not to the room rates already posted.
- The tax will not be applied for all reservations with the check-out date in the past
- If the check-out date is today and the tax is not applied, this is because the transactions were already posted
- If there are a few days of stay left, the tax will be applied to the dates of stay that have pending room rates in queue.
- If NO is selected: The tax won't be applied to future reservations, unless you edit the room rate which is not posted yet in the folio. The tax is now applied to the reservation source, so it is already in a queue. As soon as the room rate is changed, the applicable tax will appear/change as well.
To track this reservation tax recalculation, go to the Activity Log and filter the list by log Applicable Taxes Updated for Source/Applicable Fees Updated for Source.
Cloudbeds PMS needs to have the same taxes as those on your OTAs when setting up and mapping your connection with your distribution channels. This allows to ensure that your connected OTAs reservations display the correct grand total amount, with no rate discrepancies between both systems.
- For example: If your rates are inclusive on Cloudbeds PMS, then they would need to also be inclusive on any channels you connect with and vice-versa.
- Set up your Taxes and Fees as Inclusive: Remove the taxes from your connected channels and set up your rates inclusive of taxes and fees on all platforms. This is normally the easiest option, if possible. Learn more: Create, edit or delete Taxes and Fees
- Set up your Taxes and Fees as Exclusive: Adjust all rates and rate intervals so they do not include taxes/fees by following the steps here, making sure that no taxes/fees are applied to the specific third-party source. Remember to not recalculate all reservations with taxes and fees in this case. If you do accidentally click yes: Disable taxes again, click save, and select yes a second time to reverse the changes.
- Make sure you have the same taxes on each one of your connected channels.
- If you have reservations from a channel that need to have tax added to them in Cloudbeds PMS, adjust the rates manually back up to what they would be if inclusive.
Adding an exclusive tax/fee directly in reservation means that the amount of the tax/fee needs to be calculated manually. Read carefully the Things to note below, and proceed with your next steps.
Things to note:
- Taxes and Fees are not automatically added to the guest's reservation deposit. To Include taxes and fees specified as part of the deposit, go to your the Deposit tab within the Policies section.
- When you select a fee to add manually to the folio of a reservation or house account, the system will automatically load the amount of the fee you specified when you set up your fees.
- If you select a tax or fee that is a percentage, you will be able to write in a flat amount.
- If the fee has an exclusive tax applied, you will see it totaled in another field before clicking the Add button.
- Access the reservation to edit, and click on the Folio tab
- Click the Add/Adjust Charge drop-down menu to select Add Exclusive Tax/Fee
- Select the exclusive tax/fee type. The tax should be created in advance, see How to create Taxes and Fees
- Select the guest to whom you want to assign the tax/fee
- Enter the tax/fee amount. The Total Price will be automatically calculated
- Select the corresponding Folio where the tax/fee will be applied
- Select the date and time the tax should be posted. This information affects the Reports.
- Click Add
- The tax/fee added will appear in the Reservation Folio. If the transaction needs to be removed for any reason, simply click on the arrow icon to select Void Transaction. See more: How to Void Transactions
If a manually added fee has an added tax, this tax will be calculated automatically.
- Make sure your Taxes and Fees have been already created before applying them to your Items or Services: Taxes and Fees - How to create Taxes and Fees
- Changes made to price, applied taxes or fees will affect only future transactions.
- Go to the Products tab (Items and Services) within your Account Settings
- Find the item you want to add tax to, and click on the edit icon
- Click to Apply Tax or Fee and select the corresponding option(s)
- Save item
See the Stock Inventory Overview to learn more about managing your items/products in Cloudbeds PMS.