Creating entity tax codes

Use this procedure to create and maintan tax codes.
  1. Select Financials > Payables > Tax Setup > Entity Tax Codes.
    Or select Financials > Receivables > Tax Setup > Entity Tax Codes
  2. Click Create.
  3. Specify this information:
    Tax Entity
    Select a tax entity.
    Tax Code
    Select the tax code of the taxable line items to use during invoice entry for customers that are assigned this default code.
  4. On the Main tab, specify this information:
    Accrued or Invoiced
    Select Accrued or Invoiced to indicate how the tax code will affect a taxable transaction. Accrued tax represents no increase to the transaction. Invoiced tax represents an additional charge to the transaction.
    Tax Point
    Specify the date at which you want sales tax to be calculated.
    • If you select Invoice Date, then tax is calculated when you release an invoice or invoice batch.
    • If you select Shipping Date, then tax is calculated when you perform shipping feedback.
    • If you select Payment Date, then tax is calculated on the date of payment.
    • If you select the GL Date, then tax is recognized on the general ledger posting date.
    Tax Terms
    Specify whether to calculate the tax before or after payment terms are applied.
    Tax Identification
    Specify the tax identification number.
    Landed Cost
    Select this check box to include the tax on the item's cost.
    Allow Account Changes
    Select this check box to allow account change.
    Accounts Payable Tax Accrual Code
    Specify the accounts payable tax accrual code.
    Tax Input Account, Input Due, Output, Output Due
    Specify the ledger, entity, department, account, project, cost center, and payor type.
    Note: Ledger, entity, department, account, project, cost center, and payor type must be set in GL.
  5. On the Main tab, in Tolerances section, specify this information:
    Taxable Tolerance Limit
    Specify the taxable tolerance limit.
    Rate Range
    Specify the rate range percentage.
    Tax Amount Tolerance Limit
    Specify the tax amount tolerance limit.
  6. On the Vat Fields tab, specify this information:
    Value Added Tax Type
    Specify the VAT type whether domestic, Intra-EC, Import, or export.
    Good and Services Indicator
    Specify whether goods or services.
    Triangulation Indicator
    Specify the triangulation indicator.
  7. Click Save.