Best Practices for Updating Tax Rates

To ensure financial accuracy and prevent retroactive changes to historical data, it is critical to manage tax rate transitions correctly within the system.

When a tax rate changes (e.g., from 2025 to 2026), never edit an existing tax record. Instead, you must expire the old tax and create a new one.

Why You Should Not Edit Existing Rates

Modifying the percentage of an existing tax record triggers a "global update" across the database. This means:

• Historical Accuracy: Past reservations and completed stays will have their tax calculations retroactively changed, leading to accounting discrepancies.

• Reporting Errors: Your year-end financial reports will no longer match the actual revenue collected.

• Invoicing Issues: Any re-printed invoices for past bookings will show the incorrect current rate rather than the rate that was legally applicable at the time.

 Step-by-Step Transition Process

 1. Expire the Current Tax

 Locate the tax rate that is valid for the current year and set a definitive End Date.

Example: If the 9% VAT rate is changing at the end of 2025, set the expiration date to 31.12.2025.

 

 2. Create the New Tax Record

 Create a completely new tax entry for the upcoming period. This ensures the system treats it   as a unique entity.

• Tax Name: Use a descriptive name (e.g., "VAT 21% - 2026").

• Effective Start Date: Set this to 01.01.2026.

• Effective End Date: Since future tax laws can be unpredictable, set this to 31.12.2026 or further into the future if the rate is expected to remain stable.
  
  
  

Practical Example: VAT Increase

Summary Checklist

• [ ] Do Not Edit: Leave the 9% rate record untouched (aside from the end date).

• [ ] Set Expiration: Ensure the 2025 tax ends exactly one day before the new one begins.

• [ ] New Entry: Create the 21% rate as a fresh line item.

• [ ] Verify: Check that upcoming 2026 bookings are pulling the new rate while 2025 bookings remain at the original 9%.