Sales Tax codes are assigned to transactions in order to calculate tax on sales and purchases, invoices and expenses. Tax codes may be assigned to customers, vendors and warehouses as default values for transactions, and can be changed on sales and purchase orders. You can open the list of Sales Taxes from the Edit menu.
Tax Code – The code of up to 4 digits for this tax jurisdiction.
Description – Description of the tax that appears in grid columns wherever tax codes can be assigned to records or transactions.
Short Name – Name that shows as the field label on sales orders, purchase orders, AR and AP.
Integrated sales tax provider – Enable this option if you want the tax code to be connected to Avalara Sales Tax integration. See Integrations – Avalara Sales Tax in the manual for more details.
Rate – The percentage rate to charge for this tax.
Use Partial Tax Rate – Enable if this tax can be charged partially for some items. For example, if this tax is a combination of two different tax jurisdictions and in some cases the transaction can be tax exempt for one jurisdiction.
Partial Rate – The percentage to charge if a partial rate is allowed here and determined to be required on the transaction.
GL Account – The Ledger account this tax is posted to.
GL Credit Account – Add a GL account if this tax will be used for input tax credits. Usually for countries that have Value Added Tax (VAT) or GST/HST in Canada, where the tax paid by companies is recoverable against the tax that is collected from customers.
Apply to freight – Include freight charges in the tax base used for calculating the tax amount for the transaction.
Apply to surcharge – Include surcharges in the tax base used for calculating the tax amount for sales orders, as setup in Company Settings/Sales Orders/Surcharges.
Include in PO landed costs and AP expenses – When this is checked and the tax is on a purchase order, this tax will be added to the cost of the items on the PO. If un-checked then the tax will be posted separately into the GL account selected as “GL Credit Account”. When the tax is recoverable like VAT or HST this is setting is un-checked.
Communication – Add any number of notes related to this tax.
User Defined – User defined fields can be added to track and/or print. (Spire UDF license required)