How does the tax calculation work?

[tos]

I am a bit confused about how the tax calculations work in square. Is the tax rounded off on the product level before calculating the cart value or is the actual tax calculated for a cart and then it is rounded off.

[VanKalkerFarms]

It is calculated per item in the cart.  rounding could take place with each item. 

[tos]

As you can see in the image below, I have 3 test products of value $8.99. The tax on these products is 9.5%. Absolute value of tax on each product is 0.85405. Rounding the tax on product level is still 0.85. 

However, when you multiple this tax amount by 3 (quantity of product), the total should be 2.55 instead of 2.56.

[JJ_]

Hey there @tos! 👋

In this case the math taken into consideration is $26.97 x 0.095 (9.5% tax) and the total does give me $2.56 

But in regards to your questions you can setup Sales taxes as included in item price or not. In your case your 9.5% seems to be added to the item price instead of included. 

I hope this information is helpful! Let us know if you have any other questions.