1. Country-Specific Features
  2. Canada Help Topics
  3. Canada Tax Topics For Accounts Without SuiteTax
  4. Enabling Canada Tax Lookup

Enabling Canada Tax Lookup

You can choose to have NetSuite determine the proper tax code automatically when a sales transaction is entered manually or through your website.

To enable the tax lookup for Canada:

  1. Go to Setup > Accounting > Taxes > Set Up Taxes.

  2. If you are using a OneWorld account, click the Canada subtab.

  3. Check the Enable Tax Lookup on Sales and Purchases box.

  4. Click Save.

To determine the proper tax code to use for an item on a sales transaction record, the system looks for certain values in the following order:

  1. Tax Item field on the customer record

  2. Customer’s shipping address on the transaction record

  3. Tax Code field on the item record (required for most item types). For accounts with Advanced Taxes enabled, the field is labeled Tax Schedule.

The following fields also affect how tax codes are determined:

  1. Province field on the tax code record

  2. Fields on the Set Up Taxes page:

    • Tax Code for Out-of-Province Sale

    • Tax Code for International Sale

    • Default Tax Code (required)

  3. PST Exempt box on the customer record (available only for customers associated with a Canadian subsidiary)

  4. Nexus and sales tax code on the tax schedule record (in accounts with Advanced Taxes enabled)

Canada Tax Lookup

  1. To determine the tax code to use for a transaction, NetSuite first looks at the tax item on the customer record. If there is a tax group in the Tax Item field of the customer record, then the system uses that customer’s tax group for the items on the transaction record.

  2. If there is no tax group in the Tax Item field of the customer record, and the PST Exempt box is not checked, then the system looks at the shipping address on the transaction record:

    1. If the province in the customer’s shipping address is the same as yours, or you have a nexus in the customer’s province, then:

      With Advanced Taxes

      The system uses the tax schedule on the item record.

      Without Advanced Taxes

      The system uses the tax code (tax group) on the item record.

    2. If the customer’s shipping address is different from yours and you do not have a nexus in the customer’s province, then (with or without Advanced Taxes):

      If the customer’s shipping address is outside of Canada

      The system uses the tax code in the Tax Code for International Sale field on the Set Up Taxes page for Canada. If the Tax Code for International Sale field is empty, then the system uses the tax code selected in the Default Tax Code field.

      If there is only one active tax group applicable for the customer’s province

      The system uses the tax group for that province.

      If there is no tax code or there is more than one tax code applicable for the customer’s province

      The system uses the tax code in the Tax Code for Out-of-Province Sale field on the Set Up Taxes page for Canada. If the Tax Code for Out-of-Province Sale field is empty, then the system uses the tax code selected in the Tax Code for International Sale field. If the Tax Code for International Sale field is empty, then the system uses the tax code selected in the Default Tax Code field.

  3. If the PST Exempt box is checked on the customer record, the system uses the tax code in the Tax Code for Out-of-Province Sale field of the Set Up Taxes page for Canada. If the Tax Code for Out-of-Province Sale field is empty, then the system uses the tax code selected in the Tax Code for International Sale field. If the Tax Code for International Sale field is empty, then the system uses the tax code selected in the Default Tax Code field.

    Note:

    In the Tax Item field of the customer record, if you select a tax code with 0% rate, the customer will not be charged any tax.

Related Topics

General Notices