Sales Tax Management in M3 Business Engine

US or Canadian sales tax is applied to the sale or lease of goods and services. Whilst a standard, national sales tax rate is not enforced, particular goods and services attract government-levied sales tax rates.

US states and Canadian provinces are usually responsible for setting and administering their own sales tax rates, which vary from 1% to over 10%. As authority may be delegated to local authorities to impose additional or selective sales taxes, different sales tax rates can apply to different regions, cities and districts.

Generic functionality is delivered with M3 that supports the calculation, accounting, reporting, and reconciliation of sales tax. Sales tax can either be calculated within M3 itself or by leveraging the functionality of a third-party system, designed specifically for sales tax management. All sales tax can be managed using the third-party application if required . It is also possible to manage the sales tax on customer invoices within the third-party application and retain the management of sales tax on supplier invoices within M3.

M3 supports integration with two sales tax applications, AvaTax and Vertex. Note that the reporting and reconciliation of sales tax is not performed in M3 when a third-party system is used to calculate sales tax. See Define and Manage AvaTax Sales Tax and Define and Manage Vertex Sales Tax.

Tax method 4 (Purchase VAT/GST/ Sales tax interface) is a combination of Tax method 1 (VAT/GST) for supplier invoices and Tax method 3 (Sales tax interface) for customer invoices. See VAT Management in M3 Business Engine, Define and Manage AvaTax Sales Tax and Define and Manage Vertex Sales Tax, for detailed information about the functionality.

Tax method 5 (Purchase M3 Sales tax/Sales tax interface) is a combination of Tax method 2 (M3 sales tax) for supplier invoices and Tax method 3 (sales tax interface) for customer invoices. See Define and Manage AvaTax Sales Tax and Define and Manage Vertex Sales Tax, for detailed information about the functionality.