The area in which a gym is located may have laws that restrict how taxes and processing fees interact. For example, Canadian businesses are not supposed to charge tax on processing fees. In order to accommodate these requirements and enhance the experience for all users, there are now multiple options for this interaction.

By traveling to the Invoice Configuration tab within Financial Settings, one can find the Credit Card & Bank Processing Fee settings. This is where Tax on Passing on Processing Fees is configured.

Admins can choose between 3 options:

1. Inherit from Invoice, which looks at your invoice items to see if any are taxable, and applies tax to the POPF with the same rate as the highest-percentage tax rate of your invoice items.

2. Never taxable, which never taxes the POPF

3. Always taxable, which will require you to enter a tax rate to apply when nothing in your invoice is otherwise taxable.

Note: If Always Taxable is selected, then a specific tax rate is defined in the Tax Rate (%) column to the right

Frequently Asked Questions:

Q: What's the right option for Canadian businesses?

A: Canadian gyms should avoid taxation of processing fees unless otherwise advised by legal counsel. As a result, the correct choice is Never Taxable.


Q: Why would I choose Always Taxable?
A: This option locks in a set tax rate on the processing fee that will apply even if there is nothing taxable elsewhere in the transaction. 

Tip: This is particularly useful for collecting tax on processing fees when you wouldn't collect tax otherwise, like with the sale of certain foods. 

Q: How do I make sure things keep running the same as before Wodify made this update? 

A: The default selection, Inherit from Invoice, is the traditional POPF tax behavior that our clients have already been utilizing. 

Tip: This is especially useful for invoices with multiple line items - like if a member wants to add the purchase of a t-shirt to their upcoming membership renewal invoice.

If you need any additional assistance with taxation or processing fees, feel free to reach out to us at support@wodify.com.