Tax Setup

When implementing Exo Business, you can select tax rates and assign them to their matching tax return key point. You can also assign the base Debtor and Creditor tax rates, which form the default.

Automatic overrides on the accounts and stock items are then configured as new accounts or stock items are set up.

Company Defaults

The tax system in Exo Business is customised based on the country selected on the main Company setup screen of Exo Business Configurator.

This setting determines settings such as the available Tax Return Key Points, as well as the display information such as the local tax system name (for example, GST, VAT).

To select the country for the system:

Go to Exo Business Config > Company > Company Details.
Select the appropriate country in the Country field.

Note: If the country of operation is changed, the default tax rates, and the tax rate settings must also be reviewed and set to the appropriate country settings. Changing the country also alters the available tax return key points, used to configure the integrated tax returns - see the following sections for more detail.

Essential Defaults

Tax Basis

Invoice- or payments-based tax determines how taxation reports are run, and also if extra tax rate functions must be enabled (for example, whether an overriding tax rate is required on a payment with payments-based tax systems).

The tax basis is set at Exo Business Configurator > Essential > General Settings.

Note: MYOB Exo Business recommends and supports Invoice-based tax only.

You can record a variety of tax rates on each line of an invoice. When a payment is made, you an only record a single tax rate.

While you can use Exo Business and report tax on a payment basis, by default Exo Business enables you to record tax at a finer level of detail than on a payment basis. If multiple tax rates occur on the same invoice (or apply to the same customer or supplier), then reconcile tax on a payment basis by ensuring that payments received or made are consistently allocated against invoices. Then, produce estimates of tax using reports that calculate the tax content of invoices that are paid during the period.

Note: Some features, such as the Australian BAS Return, cannot support payment-based tax, because fundamental linking is done at an invoice line level.

Debtor Pricing

To set the tax inclusive/exclusive setting for Debtor pricing:

Go to Exo Business Configurator > Essential > General Settings.
Select the Tax inclusive pricing for debtors option to set sell prices of stock items as tax inclusive. Leave this option deselected to set stock prices as tax exclusive.

Tax Rates

Use tax rates to group the purpose of the tax on an invoice or payment. You can report on these tax rates for tax returns. When linked with tax return key points, they form the basis of the Tax Return systems.

To set up tax rates:

Open the tax rates table from Exo Business Configurator > Essential > Tax Rates.
Create a tax rate by clicking New, or double-click on an existing rate to view and edit it.

Enter this information, and then click Save:

Field	Description
Tax rate name Tax rate short name	Descriptive names to reference the tax rate.
Tax rate %	The percentage rate of tax to record.
Tax return key point	Identifies the corresponding field on the tax return, using this tax rate as part of the calculation. See Tax Return Key Points below.
GL control account	Leave the Use Default box selected to use the GL control account specified in Configuration Assistant > Business Essentials > GL Control Accounts for the debtors and/or creditors tax account. Otherwise, deselect this option and select a GL account for the rate.

To verify that the tax rates have valid key points, and to also check that only valid tax rates exist on debtor, creditor, stock and GL accounts, click the Check Rates button on the toolbar. This performs a check, and report errors and warnings.

In a new implementation, you can load the suggested default rates for the selected country by clicking the Load Rates button. This button is only enabled if the tax rate table is empty.

Troubleshooting

The most common reason for the Check Rates function reporting null key point values is because there is no Tax return key point setting for a tax rate. A blank tax rate description also makes a tax rate invalid. If the rate number is shown in the table, it is expected to have a matching tax key point.

Avoid or delete blank description tax rates. All tax rates point to a key point to confirm they have not been misconfigured. Use the tax return point NA – Not recorded on return if the rate is not to be entered on a tax return.

Other common causes of invalid tax rates include incorrect initial settings for default tax rates, or data imported into the database that has not set the tax rate fields. These fields must be set when importing data:

dr_accs.taxstatus
cr_accs.taxstatus
stock_items.salestaxrate
stock_items.purchtaxrate
glaccs.taxstatus

Default Tax Rates

Default tax rates are the lowest level in the hierarchy of tax rate defaults. They're used on transactions unless specifically set by rates on the account or the stock item, or manually overridden.

To set the default tax rates:

Go to Exo Business Configurator > Essential > General Settings.
Select one of the pre-defined Tax Rates for the Base debtor tax rate and Base creditor tax rate.

WARNING: The default tax rates must be set correctly. Invalid tax rates can prevent transaction from being entered.

Tax Return Key Points

Tax Return Key Points are the references to the key points on the country’s tax return system. Tax return key points are pre-defined, relevant to each country. You can view them but you can't edit them. Assigning of the key point to a tax rate that controls what displays on the tax return. You can add more than one tax rate to the same tax return key point.

To view the pre-defined Tax Return Key Points, go to Exo Business Configurator > Administration > Finance > Tax Return Key Points.

You can double-click on a key point to show more information on the item, such as its full description.

Tax Return Key Points are listed as Creditor and/or Debtor. These properties carry through when assigned to tax rates, and help prevent incorrect tax rates being entered on the wrong transaction types.

You can use the DIS and N/A key points to disable a tax rate to prevent data entry, or to not display the rate on a tax return.