Invoices with Sales Taxes: General Information

In your company’s invoices, a sales tax is a tax collected by a company from customers as a part of the invoice amount; then the company pays the accumulated tax amounts to the responsible tax agency. In MYOB Acumatica, the system calculates the sales tax in customer documents automatically.

Learning Objectives

In this chapter, you will learn how to do the following:

• Create an AR invoice with a sales tax applied
• Release the AR invoice and review the GL transaction generated by the system
• Process an AR invoice with a cash discount and a sales tax applied
• Pay an invoice within the cash discount period and review the GL transactions generated by the system

Applicable Scenarios

You create an AR invoice with a sales tax to record sales subject to sales taxes. At the end of the tax reporting period, you will generate a tax report that will collect tax-related amounts from all AR invoices, which you will pay to the tax agency.

Applying Sales Taxes to AR Documents

After you have configured all the required configuration entities (tax zones, categories, tax agency accounts, and taxes), the sales taxes are automatically applied to taxable AR invoices, debit memos, and credit memos if all of the following conditions are met:

• The date of the document is the same as or later than the effective date of the tax.
• The tax zone specified in the document includes the tax. By default, the tax zone is copied from the settings of the customer's account. If a tax zone is not specified for the customer, the system uses the tax zone that is specified in the settings of the selling branch (if a tax zone is specified for the branch). If needed, you can manually override the tax zone in the document.
• The tax category specified in the document line includes the tax. If a stock or non-stock item is selected in the document line, the tax category of the item is used for the line. If no item is specified in the document line, the default category of the tax zone specified for the document is used for the line. If needed, you can manually override the tax category in the document line.

The system calculates the tax and taxable amounts by using the settings of each tax that corresponds to both the tax category of the specified inventory ID and the tax zone of the selected customer. The system calculates the tax and taxable amounts for each line of the document or for the total document amount, depending on the settings of the applied tax (for details, see Sales Taxes: To Create a Sales Tax for Use in AR). The system inserts the sales tax amount in the Tax Total box in the Summary area of the Invoices and Memos (AR301000) form.

Once any taxable invoice is released, the system updates the GL account balances and the corresponding amounts in the tax report.

Applying Sales Taxes to AR Documents with Cash Discounts

If an AR document includes a cash discount, the system applies the cash discount percent based on the option selected in the Cash Discount Base box on the Company Details tab of the Companies (CS101500) form:

• If Document Amount is selected, the cash discount percent is applied to the total amount of a document, which is the purchase price or sales price plus the tax amount.
• If Document Amount Less Taxes is selected, the cash discount percent is applied to the taxable amount of the document. The tax amount calculated for the document will be the same regardless of whether a cash discount is applied to the document.

For details on calculating cash discounts, see Setup and Calculation of Cash Discounts.