Basic and advanced tax rate options

Use the basic tax rates option to remove rates not required for Simpler BAS. You can switch between using basic and advanced tax rates on the Tax Rates page. You'll need the Adviser or Standard user role.

Use basic tax rates for Simpler BAS reporting

If you select the basic tax rates option, Xero retains these rates:

  • BAS Excluded
  • GST Free Expenses
  • GST Free Income
  • GST on Expenses
  • GST on Income
  • GST on Imports

Xero archives these advanced tax rates:

  • GST on Capital
  • GST Free Capital
  • Input Taxed
  • GST on Capital Imports
  • GST Free Exports

Custom rates you’ve created aren’t affected.

When you select basic tax rates, tax rates of transactions already entered don’t change, unless they are draft transactions. If you edit a transaction that used an archived tax rate, you'll need to select a new tax rate before saving your changes.

How Xero replaces the advanced tax rates

If an advanced tax rate is in use, Xero replaces it with a basic tax rate. Xero updates your:

  • Chart of accounts
  • Bank rules
  • Repeating transaction templates
  • Contacts
  • Inventory items
  • Draft transactions (any draft invoices, bills, expense claims, manual journals, purchase orders or quotes)

Here’s how Xero replaces advanced tax rates:

Advanced tax rateReplacement basic tax rate
GST on CapitalGST on Expenses
GST on Capital ImportsGST on Imports
GST Free CapitalGST Free Expenses
GST Free ExportsGST Free Income
Input Taxed

GST Free Income, if used with a revenue account or as a contact’s default sales GST Rate

GST Free Expenses, if used with an expense account or as a contact’s default purchases GST Rate

BAS Excluded, if used with an asset, liability or equity account

Use advanced tax rates for full tax reporting

Selecting advanced tax rates let's you use the following tax rates in addition to the basic tax rates:

  • GST on Capital
  • GST Free Capital
  • Input Taxed
  • GST on Capital Imports
  • GST Free Exports

If you want to set an advanced tax rate as the default on an account, item or transaction, you’ll need to set this manually.