Taxes

These processing options specify tax information.

1. Update Tax File

Specify whether and how to update the Taxes table (F0018) when you post transactions with tax information to the general ledger. Values are:

Blank: The system does not update the Taxes table.
1: The system updates the Taxes table for these tax explanation codes only: V, VT, V+, U, and UT.
2: The system updates the Taxes table for all tax amounts.
The system does not update the Taxes table for transactions with tax explanation code E (exempt).
3:The system updates the Taxes table for all tax explanation codes including E (exempt).

2. Update VAT Discounts

Specify whether to adjust the tax amount fields, and which fields to adjust, when discounts are taken. The system adjusts the tax amount fields only for transactions with tax explanation code V.

Note: These options in the tax rules must be turned on to use this processing option:

Tax on Gross Including Discount
Discount on Gross Including Tax

Values are:

Blank: The system does not adjust tax amounts for discounts taken.
1: The system updates only the tax amount field (STAM).
2: The system updates the tax (STAM), taxable (ATXA), and extended price (AEXP) amount fields.

The system uses these algorithms to calculate the adjustment amounts to the tax, taxable, and gross (extended price) amount fields for discounts taken:

Adjustment to the gross amount (extended price) = discount taken.
Adjustment to the taxable amount = (taxable amount / gross amount) x discount taken.
Adjustment to the tax amount = (tax amount / gross amount) x discount taken.

For example:

Tax Rate = 25 per cent.

Discount Taken = 12.50 USD.

Gross Amount (Extended Price) = 1,250.00 USD.

Taxable Amount = 1,000.00 USD.

Tax Amount = 250.00 USD.

Based on the example, using the adjustment algorithms, the system calculates these adjustment amounts:

Adjustment to the Gross Amount = 12.50.
Adjustment to the Taxable Amount = 10.00.
Adjustment to the Tax Amount = 2.50.

To calculate the adjustments, the system subtracts the adjusted amount from the original amount:

Adjusted Gross Amount: 1,250.00 - 12.50 = 1,237.50.
Adjusted Taxable Amount: 1,000.00 - 10.00 = 990.00.
Adjusted Tax Amount: 250.00 - 2.50 = 247.50.

3. Update VAT Receipts and W/O (update VAT receipts and write-off)

Specify whether to adjust the tax fields, and which fields to adjust, when the receipt has a write-off. The system adjusts the tax amount fields only for transactions with tax explanation code V. Values are:

Blank: The system does not adjust tax amounts for write-offs.
1: The system updates only the tax amount field (STAM).
2: The system updates the tax (STAM), taxable (ATXA), and extended price (AEXP) amount fields.

The system uses these algorithms to calculate the adjustment amounts to the tax, taxable, and gross (extended price) amount fields for write-off amounts.

Adjustment to the gross amount (extended price) = write-off amount.
Adjustment to the taxable amount = (taxable amount / gross amount) x write-off amount.
Adjustment to the tax amount = (tax amount / gross amount) x write-off amount.