Calculate Tax on a Billing with AS Native Tax

Overview 

Calculating Tax on a Billing with Accounting Seed (AS) Native Tax is different depending upon whether Header Level Posting (HLP) or Line Level Posting (LLP) is enabled. 

Do you want to:

• Calculate Tax on a Billing with Header Level Posting (HLP)
• Calculate Tax on a Billing with Line Level Posting (LLP)

Calculate Tax on a Billing with Header Level Posting (HLP)

With HLP enabled, a Tax Group needs to be selected for each Billing Line. A default Tax Group can also be added to a Product to automatically populate the Billing Line. For more information, refer to the Set up AS Native Tax article.

Note: Under HLP, a Product is not required on the Billing Line for tax calculation. 

1. Navigate to Accounting Home and click the Create Entries tab. Then, under the Revenues menu, click Billings.
2. Display a Billing record. 
3. Select a Billing Line and click Edit. Otherwise, click New to add a new line. 
   Note: You can also click Mass Add/Edit Rows to search for and select a Tax Group for each Billing Line. Then, click Save & Refresh, Save & Complete, Save & Post, or Save & New to calculate the Tax Amount.
4. In the Tax Group field, click the Lookup icon to search for and select a Tax Group.
   
   Note: The lookup only displays active Tax Groups.
   
   If you are using a Tax Group that has the Tax Inclusive checkbox selected, this checkbox will also be selected on the Billing Line. Additionally, the Combined Tax Rate will populate from the selected Tax Group. The Tax Amount for the line will be based upon the formula below.
   
   Note: In many countries, the Unit Price is stated with the Tax Amount included. The Tax Inclusive calculation provides a way to “back into” the Tax Amount. The Tax Inclusive calculation is only applicable if you are using Header Level Posting with AS Native Tax.
   
   When using a Tax Group with Tax Inclusive checkbox selected, the formula for calculating taxes is based upon the information below.
   
   Total formula is Quantity X Unit Price
   
   Sub-Total formula is Total / (divided by) 1 + the Combined Tax Rate
   
   Tax Amount formula is Total – (minus) Sub-Total
   
   On the first line in the sample screen below, we used the above calculation formula to back into the Tax Amount of 30.14 by selecting a Tax Inclusive Tax Group and we backed into the Sub-Total for the line, in the amount of 207.86.
   
   Note: Click here to view the above image in full screen. 
   
   You can view the Tax Inclusive video below. 
   
   

5. Refresh the Billing record. The Tax Amount displays based upon the selected Tax Group.
   
   
   Note: Click here to view the above image in full screen. 
   
   Note: When a Billing has cash or credit applied, the Tax Group should not be changed. If an attempt is made to change the Tax Group, a message will display to prevent this action (the message does not expressly mention “Tax Groups”). 
   

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Calculate Tax on a Billing with Line Level Posting (LLP)

Note: When a Product on a Billing Line is not set up to be taxable, an error message will display to indicate that there is no taxable Product associated with a Billing Line. Additionally, when there are no Products on any Billing Lines and the Calc Tax button is clicked, an error message will display to indicate that no Billing Lines were found with an associated Product.

1. Create a Billing and add Billing Lines.
2. Click Calc Tax. The intermediate screen displays.
   Note: If you have the Large Data Optimizer (LDO) feature enabled, refer to the line limit information that relates to clicking the Calc Tax button in the Large Data Optimizer article.
   
3. Click Calc Tax again. 
   Note: A new Billing Line will be automatically added for each Tax Rate assigned to the Customer account. Each tax line will be the sum of the Tax Rate times the Line Amount across all taxable lines. For example, if the Billing had one Billable Line for $100 and the customer account was set up for Illinois State Sales Tax (7%), Cook County Sales Tax (1%), and Chicago Sales Tax (3%), Billing would have four lines:
   • One Billing Line with the taxable product for $100
   • One sales tax line for the Illinois State Sales Tax for $7
   • One sales tax line for the Cook County Sales Tax for $1
   • One sales tax line for the Chicago Sales Tax for $3.
     
     
     Note: Click here to view the above image in full screen. 

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Spring '24 Release

Release Notes and Schedule

• The Large Data Optimizer feature is available. For more information, refer to the Large Data Optimizer article.
• The Tax Inclusive calculation is available if you are using Header Level Posting (HLP) with AS Native Tax as your tax method.