Tax and VAT (value-added tax) are both forms of taxation, but they differ in how they are calculated and applied.
Tax is a broad term that refers to various types of imposed charges.
VAT, on the other hand, is a specific type of tax that is applied to the value added in the production and distribution process of goods and services. It is a tax on the final consumption of goods and services and is usually paid by the end consumer. VAT is used in many different countries worldwide, such as those in the European Union. It is referred to as a goods and services tax (GST) in certain countries such as India and Australia. The U.S. does not use VAT, and instead uses a sales tax which differs by state.
You can set your Default Tax Rates or VAT under Settings > Taxes.
You'll see that under VAT, you can set the percentage (%) as well as the VAT number. A VAT number is an identification number for VAT-registered companies. If you have one, you should include it here to enable a VAT checker on invoices. Having that enabled will allow customers to apply their own VAT number.
Note: If you want to use GST or PST, then you can use the regular tax field and simply change the label to GST or PST.
Check out this article on setting up taxes and fees to learn more. And if you need more help, you can contact support@paycove.io.