Change Assignments For Tax
Account and Exempt Level Qualifiers
Modify Your Tax Account Qualifier
You can control the level of detail for your Sales Tax Liability accounts. Typically, a distinct liability account is created for each state. You can however, create distinct accounts for each city or county. Receivables assigns the Account Qualifier at the State segment of the recommended Sales Tax Location Flexfield structure 'State.County.City'.
You can assign the Tax Account qualifier to any segment of your flexfield structure in the Key Flexfields window, but you can assign it to only one segment. Then, when you define tax accounts in the Tax Locations and Rates window, you will be able to assign them to components of this segment. Therefore, if you assign the tax account qualifier to the 'State' segment, you can define tax accounts at the State level only.
Note: The tax account defined for your Location Tax Code will be the default tax account in the Tax Locations and Rates window.
Refer to the chart in Customizing Your Sales Tax Location Flexfield Structure to see the default levels at which Receivables enables the Tax Account qualifier in the seeded tax structures. This is a mandatory qualifier, so you must assign it to one, and only one, segment of your flexfield structure.
Modify Your Exempt Level Qualifier
Receivables will create unapproved customer certificates at the bill-to customer site and the ship-to state. This is the normal behavior if the Exempt Level Qualifier has been assigned to the 'State' segment of the Sales Tax Location Flexfield structure. Using the Exempt Level Qualifier you can control the level of detail at which the unapproved certificate will be automatically created during invoice entry and import.
Refer to the chart in Customizing Your Sales Tax Location Flexfield Structure to see the levels at which Receivables defaults the Exempt Level qualifier in the seeded tax structures. This is an optional qualifier. If no Exempt Level qualifier is enabled, automatic exemptions will be created at the customer level.
Calculate Tax Externally
Receivables can integrate tax calculation programs which are external to the product using the Tax Vendor Extension. This lets you provide for complex tax calculation needs while retaining the full power of Receivables to create and store all other tax data.
Import Sales Tax Locations and Rates
You can use the Sales Tax Rate Interface program to load locations and sales tax rate records into Receivables. These will be used for both address validation and the calculation of sales tax. If you subscribe to a tax service, you can use this program to load the locations and rates that the tax service supplies.
Create Tax Exemptions
Tax exemptions let you fully or partially exempt specific customers or items from tax. You can use exemptions in either a VAT or location-based tax environment.
You can define exemptions either at the customer or item level or specify them at the regional levels. For example, you could create a customer exemption such that the customer is always exempt from tax, or is exempt only in the state of California.
Create Tax Exceptions
Tax exceptions are special tax rates that are assigned to items being shipped to specific addresses. Tax exceptions are only used when you are calculating location-based tax.
Reconcile US Sales Tax
Receivables provides the US Sales Tax Report to assist you in preparing Sales Tax Returns and in reconciling these returns to your General Ledger. The report lists the gross, taxable, exempt and tax amounts for a given period, broken down by state, county and city, to let you identify and review your sales tax liability to the various tax authorities around the US.
See Also
Calculating Tax
