The program’s tax management system accommodates both Value Added Tax systems and complex multiple tax environments, as found in North America.

In its simplest form you need a single tax class, a single tax and a single tax regime. The regime is what the user associates with a customer on a sales order, job or invoice and a class is what the user associates with the part or type of product or service being sold. The rate of tax is then automatically calculated from the tax associated with the regime and the class. More complex arrangements involve multiple classes, multiple taxes and multiple regimes involving multiple taxes.

The data structure is illustrated above. There is a table of tax classes and a table of taxes. Each tax and class combination can have a non-zero tax rate. There is then a table of tax regimes (which is what the user selects for a customer or supplier) and a link file that determines which tax or taxes are applied under the regime and in what order. A total of five files make up the tax system definitions.

Customers, Suppliers and Additional Addresses are assigned a tax regime. Parts and various non-part defaults are assigned a tax class. These then provide the default regime/class combination for sales order, job and invoice line items.

When sales order or job line items are dispatched and invoice line items and sales history records are created, the prevailing tax structure is applied, and a tax identifier is stored in ledger transactions.

Ledger transaction detail is not available if you do not have the Ledgers license option.

The sales history records (that are Invoice line items) contain several fields relevant to tax:

When transactions involving tax are posted to the Ledgers the Tax Identifier field (TRATAXC) is used to store either the tax regime identifier OR the tax identifier OR nothing on the following basis:

WARNING: Deleting any element of the tax structure will lead to the system applying a zero rate for the regime or class that is subsequently un-defined.

TIP: Normal practice in most countries has it that an invoice or other document showing tax should have a tax breakdown list and that the values are shown in local (tax authority) currency rather than the invoice currency. The program provides this by default. However, an Option optTaxListInCurrency can be used to override this so that the tax and turnover are listed in the document currency.

TIP: In almost all circumstances tax authorities apply tax directly on the value of the goods sold or purchased. However, in some cases, such as some import excise duties, taxes can be charged on an uplifted value of the goods. The program provides for this with an Option. optTaxOnUpliftValue is a list of TaxRegime,UpliftPercent, separated by commas, of those tax regimes where the tax is calculated on the goods value uplifted by a percentage. A negative percent rate would apply the tax on a reduced value.

File Path

File > System Manager > Taxes…

This file path takes you to the Tax Maintenance window. This window has 4 tabs.

Tax Class Definitions tab

Use this pane to define tax classes. Parts in the system are designated to a tax class and each government tax can have a tax rate for each tax class.

The tax class code is a single uppercase character. Therefore, you can have up to 36 classes if you wish. Typically, you have only a few. These provide default classifications for products that incur different tax rates.

Tax Class List

List of all tax classes. Parts in the system are designated to a tax class.

Tax Class 

Tax class (related to TARCLAS).

Description

Class description.

New Class button

Click to add a new tax class to the system.

Check Master Data button

To perform a test of tax field validity in the master document data.

If tax regimes are removed, by default any master records that retain the now missing regime will have zero tax applied. This function can be used to check for master records that do not hold current tax regimes.

Print Report button

To print a report of tax setup.

Revert button

Revert the edited tax data to that saved on file.

Save button

Save the edited tax details to file.

WARNING: Deleting a tax class (click on the list line and use the delete key) that is assigned elsewhere in the system will lead to the system applying a zero rate for the class that is subsequently un-defined.

Tax Definitions and Rates tab

Government sales and purchase taxes. Each tax has a rate for each tax class and tax regimes contain one or more taxes.

These are the actual taxes that are paid to governments. It is here that you define how the taxes are calculated and where in the Ledgers (if licensed) the tax charged is accrued. If you have Ledgers licensed you must assign a G/L type T account as each tax’s accrual account, however, multiple taxes can be accrued to the same account.

The options control how the tax is calculated. Some taxes in multiple tax environments are charged on the taxed sale. For example, Quebec state sales tax is charged on the sale after Canadian federal sales tax has been applied. This is a compound tax. To affect this the Quebec sales tax should be the second tax in a regime, with the federal tax first. The Quebec tax is marked as a ‘Tax is calculated compound’. If the federal tax is 10% and the Quebec tax is 5%; for a $100 sale, federal tax is $10.00 and Quebec tax is 5% * $110 = $5.50 and not $5.00.

Tax authorities also vary in their treatment of Quick-Payment Discounts. In the UK and other European VAT territories, tax is charged on the discounted sale regardless of whether, in due course, the discount is granted to the customer. The tax authority’s view is that a quick-payment discount is in practice a ‘late-payment finance charge’ and as such is not taxable. For example, if you sell a GBP100 item with a quick-payment discount of 5% and a VAT rate of 10%, the tax will be 10% * GBP95 = GBP9.50. If the customer pays on time, he pays GBP95.00 + 9.50 = GBP104.50 or if he is a late payer GBP100.00 + 9.50 = GBP109.50.

The Expense when purchase is a special case in that the tax calculated is not accrued but posted to the cost account of the transaction in the G/L. This is appropriate when you cannot claim the tax back but want it individually recorded in the A/P, particularly when combined with taxes which can be accrued.

Tax List

List of all government taxes. Each tax has a rate for each tax class and tax regimes contain one or more taxes.

Tax Code

Unique tax code (related to TALTAXC and TARTAXC).

Description

Tax description.

Options – Tax is calculated compound (tax on tax)

Tax is calculated compound (tax on preceding taxed value).

Options – Quick-payment discount is not taxable

Quick payment discount is not taxable.

Options – expense when purchase (not accrued)

Tax is expensed on a purchase rather than accrued.

Accural a/c

General Ledger accrual account.

G/L a/c description

General Ledger Accounts description.

Reg. No

Tax authority registration number.

User ID

User ID to use when communication with the tax authority.

Password

Password.

Plain button

Toggle to show in plain text.

New Tax button

Click to add a new government tax to the system. If the tax is to be used it must then be included in a Tax Regime.

Tax Rate for Selected Tax

List of all tax class percent rates for the selected tax.

Tax Class

The tax class.

Rate in Percent

Tax rate in percent.

Class Description

Description of the tax class.

Tax Regimes tab

Tax regimes generally apply to customers and suppliers. They contain one or more taxes. When tax is applied the tax regime is combined with the tax class to arrive at the appropriate tax rates.

To generate a tax regime, enter a code of up to 6 characters and a description, then drag a tax from the taxes listed at the bottom right and drop it onto the list above. When applying more than one tax, the order is significant when a second or subsequent tax is a compound tax. To change the order in the list click and edit the numbers in the list.

The type of regime is significant in where it will be made available to users; either sales or purchase or both. Only sales taxes are of use if you do not have the Ledgers license.

Regime List

List of all tax regimes that can be applied by users of the system. Regimes can contain more than one tax. Each tax in a regime has a rate for each tax class.

Regime Code

Tax regime code used in transactions (related to TALCODE).

Description

Tax description for user to identify (can combine multiple taxes).

Regime Type

Tax type – determines when the regime is offered to the user (0 = Sales and Purchase (VAT), 1 = Sales only, 2 = Purchase only).

List of Taxes for Selected Regime

List of taxes that apply to the regime. The order is only significant when taxes are compound. Drag a tax from the list below to add a tax to the regime.

Tax List

List of all government taxes. Drag a tax from this list to add it to a regime.

New Regime button

Click to add a new tax regime which must have at least one tax assigned.

Regime Tax Matrix

This pane provides a listing of net rates for the tax classes and regimes.

Net Tax List

List of all net tax rates for each tax class and each regime.

Compiled in Program Version 6.00.  Help date last modified on 5 February 2024

Class wtaxmaint (Tax Maintenance) last modified 25 May 2022 FP: File > System Manager > Taxes…

The post Manager Controls: Tax Maintenance appeared first on Caliach.

In this tab you can enter system currency and tax details

File Path

File path File > System Manager > Company Details

This file path will take you to the Company Details Maintenance window. Select the Money and Tax tab.

This article is part of the Vision Setup Guide. Click Here to return to the Setup Guide.

BUTTONS AND FIELDS

System Currency Field

Symbol

Here you can insert your system local currency eg. £ or €

Caliach Vision is a multi-currency system enabling you to create POs and SOs in any currency defined in Currencies. The symbol entered here is the local currency that you normally work in and the text is used in documents. Any Sales or Purchase record has the currency code (or symbol) written to it. If you change the standard currency symbol the system will warn you and, if confirmed, replace the old code on all records with the new one. This can take some considerable time if there are many histories and/or ledger transaction records.

WARNING – If the updating process is running, you MUST NOT INTERRUPT the processing, however long it takes. If you do, the Datafile must be discarded, and a backup used.

TIP – You can change your local currency to a new one. This special process does not just change the currency symbol but migrates all the appropriate values stored in the data to the new currency. For further details see the Local Currency Migration window.

Decimal

Enter the decimal symbol for your local currency eg. p for penny or c for cent.

TIP – If you use the # (hash or pound) character as your currency decimal character the cent portion of an amount printed in words on documents such as sales orders, invoices and cheques is suppressed. This feature is provided for large scale currencies such as Rupees and Yen.

Full Name

Enter the name of the local currency you are using.

Sales and Purchase Tax Field

Tax Name

This is your abbreviated name for sales tax on invoices eg. TAX.

Registration Number

Enter your VAT registration number.

EORI Number

Enter your EORI Number.

Default Class and Customer Regime fields

Click here for the Tax Maintenance guide for full details of the tax handling system.

Part Sales Price Group Currencies

You can enter up to five currencies plus your local currency for parts pricing in this field. These must be pre-defined as currencies in the Currency Control window which can be accessed by clicking the Currency Maintenance button in this section. Click here for our Currency control guide.

When a SO is created in a foreign currency and that currency is one of these five and there is a non-zero price in the appropriate part currency price field, that price will be applied to the SO line item. Otherwise, the current currency exchange rate will be applied to the local price.

Currency Maintenance Button

Selecting this button will take you to the Currency Control window. Please click here for our Currency Control guide.

Sales Commission System Default field

Here you can enter the Non-part items class.

Non-parts Item Class

This field will contain your commission class for non-part items as set up in the Commissioned Sales Agents Maintenance window. This will be completed at a later date.

Commissioned Agents Maintenance button

Selecting this button will take you to the Commissioned Sales Agents Maintenance window. Click here for the Commissioned Sales Agents Maintenance guide.

This article is part of the Vision Setup Guide. Click Here to return to the Setup Guide.

Compiled in Program Version 6.00.

Class wCalendar (Make and Buy Calendar Maintenance) FP: File > System Manager > Calendars

The post Company Details Maintenance – Money and Tax appeared first on Caliach.