SuiteTax Latam Engine Tax Determination Process

Note:

To access the SuiteTax Latam Engine SuiteApp documentation in other languages, do the following:

To access the documentation in Brazilian Portuguese (Português do Brasil), see SuiteTax Latam Engine.
To access the documentation in Spanish, select Español (Latinoamérica) from the dropdown list at the top right corner of the NetSuite Help Center.

The SuiteTax Latam Engine enables you to use different plug-ins to calculate taxes on transactions. For each sale or purchase transaction, NetSuite determines which tax determination rules to apply. Then, the system triggers the appropriate plug-in implementation to calculate the tax amounts.

The tax determination process starts in when you click Save or Preview Tax in a transaction. NetSuite gathers information from the transaction to identify tax determination rules records that match the provided information. The transaction information include the subsidiary, vendor, and associated records.

Tax determination rules records include the tax codes and tax rates required to calculate taxes. For more information, see Creating Tax Determination Rules in the SuiteTax Latam Engine.

The SuiteTax Latam Engine uses the following fields to gather the information needed to match a transaction with tax determination rules:

Transaction Type	Transaction Fields	Tax Determination Rules Fields
Purchase Transactions	Item	Item Code
Subsidiary	Subsidiary City of the Receiver State of the Receiver Line of Business of the Receiver Tax Regime of the Receiver
Vendor	City of the Issuer State of the Issuer Line of Business of the Issuer Tax Regime of the Issuer
Operation Code	Operation Code
Sales Transactions	Item	Item Code
Subsidiary	Subsidiary City of the Issuer State of the Issuer Line of Business of the Issuer Tax Regime of the Issuer
Customer	City of the Receiver State of the Receiver Line of Business of the Receiver Tax Regime of the Receiver
Operation Code	Operation Code

Transaction Type

Transaction Fields

Tax Determination Rules Fields

Purchase Transactions

Item

Item Code

Subsidiary

City of the Receiver

State of the Receiver

Line of Business of the Receiver

Tax Regime of the Receiver

Vendor

City of the Issuer

State of the Issuer

Line of Business of the Issuer

Tax Regime of the Issuer

Operation Code

Sales Transactions

Item

Item Code

Subsidiary

City of the Issuer

State of the Issuer

Line of Business of the Issuer

Tax Regime of the Issuer

Customer

City of the Receiver

State of the Receiver

Line of Business of the Receiver

Tax Regime of the Receiver

Operation Code

Note:

The SuiteTax Latam Engine uses the customer or vendor’s default shipping address to determine their state and city. If you want to use a different address in a specific transaction, click the Shipping subtab and select another address.

After it determines the eligible rules, the system uses the item code and operation code to identify which of those rules apply to each item in the transaction. Multiple tax determination rules can apply to the same item, and the rules can have several associated tax codes.

If NetSuite does not find any applicable tax determination rules, the system does not calculate taxes and displays an error message.

To calculate the appropriate taxes, NetSuite triggers the plug-in implementations associated with the tax codes records. For more information, see Associating a SuiteTax Latam Engine Plug-in Implementation With a Tax Code.

For more specific tax scenarios, the SuiteTax Latam Engine provides the plug-in implementation with additional properties that the plug-in can use to calculate tax amounts:

Amount and net amount – The SuiteTax Latam Engine provides the plug-in implementation with both the amount and net amount of each line item. The net amount considers the discounts applied to items or the entire transaction.

The plug-in implementation can use either the amount or net amount to comply with tax regulations.
Shipping and handling costs – If shipping or handling costs apply to the transaction, the SuiteApp provides the plug-in implementation with their total and proportional amounts. To obtain the proportional amount, NetSuite splits the individual amount of each line item by the sum of all the items. Then, the system multiplies it by the total shipping or handling amounts.

By default, the SuiteTax Latam Engine does not consider shipping and handling costs in the tax determination process. Shipping and handling items do not appear as line items in the Tax Details subtab.
Additional tax information – If you map transaction fields as additional tax information, the SuiteApp provides the plug-in with the information contained in the transaction fields.

The plug-in must be prepared to handle the additional tax information properly. For more information about mapping, see Creating Tax Information Mapping Records.

After the calculation, NetSuite displays the tax amounts on the transaction’s Tax Details subtab and Summary Box.

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