Setting Tax Options

From the Tools menu, select Options to open the Options window.

In the left pane of the window, click on Tax Options.

In the Consumption tax type region, enter the following information as appropriate:

In the Consumption tax type field, use the lookup icon to select one of the following method for taxing goods and/or services:

Sales Tax: Select this option if your company does business exclusively with customers and/or vendors where only sales tax is assessed (e.g., a company doing business only with customers and/or vendors in the U.S.).

Sales Tax and VAT: Select this option if your company does business with one or more customers and/or vendors where sales tax is assessed (e.g. a company doing business with a customer and/or vendor in the U.S.) and one or more customers and/or vendors where Value-added Tax (VAT) is assessed (e.g., a company doing business with a customer and/or vendor in Canada, the UK, the Republic of Ireland).

VAT: Select this option if your company does business exclusively with customers and/or vendors where only VAT is assessed (e.g., a company doing business only with customers and/or vendors in Canada, the UK, the Republic of Ireland).
Note: If you created your VAT company database using the Jump Start Data UK template, the system defaults this field to VAT.
Caution: Changing the Consumption tax type has system-wide implications. ECI recommends consulting with an accountant and reviewing all help documentation related to Sales Tax and/or VAT before changing the value selected in this field.

If you set Consumption tax type to Sales Tax and VAT or to VAT, do the following if applicable:

In the Tax standard as field, enter the default VAT code defined in Lists and Codes to use for standard tax (e.g., S - Standard).
Note: If you created your VAT company database using the Jump Start Data UK template, the system defaults the value in this field to S - Standard.
Note: The system only displays this field when the Consumption tax type field is set to Sales Tax and VAT or VAT.

If the system displays an [MTD Options] button to the right of the Consumption tax type field, do the following:
Note: The system only displays this button when the Consumption tax type field is set to Sales Tax and VAT or VAT and when your e-automate language is set to en-GB. For more information, see the Configuring Region and Language Settings for VAT Functionality topic.

Click the [MTD Options] button.

In the Base URL field, enter the URL to the ECI Software Solutions - Manage VAT Portal for submitting a Making Tax Digital VAT Return to HMRC.

In the VAT Number field, enter your VAT number.

In the Tax as defaults region, enter the following information as appropriate:
Note: If you are using the Avalara tax calculation integration and you have set up sub-tax flags that are more specific to what is being taxed, you also select those sub-tax flags in these fields.
Note: If you set Consumption Tax Type to Sales Tax and VAT or to VAT, then enter in all the fields in this region the default VAT code defined in Lists and Codes to use for standard tax (e.g., S - Standard). If you created your VAT company database using the Jump Start Data UK template, the system defaults the values in all of these fields to S - Standard.

In the Activity code field, use the lookup icon to select the default tax flag to be used for standard tax.

In the Items field, use the lookup icon to select the default tax flag to be used for items tax.

In the Freight field, use the lookup icon to select the default tax flag to be used for freight tax.
Note: The system only displays this field when the Consumption tax type field is set to Sales Tax and VAT or VAT, and/or when the Avalara tax calculation engine is enabled.

In the Miscellaneous charge field, use the lookup icon to select the default tax flag to be used for misc tax.
Note: The system only displays this field when the Consumption tax type field is set to Sales Tax and VAT or VAT, and/or when the Avalara tax calculation engine is enabled.

In the Travel field, use the lookup icon to select the default tax flag to be used for travel tax.
Note: The system only displays this field when the Consumption tax type field is set to Sales Tax and VAT or VAT, and/or when the Avalara tax calculation engine is enabled.

In the Miscellaneous region, check any of the following boxes that apply:

Require tax code on customers: When checked, e-automate requires a Tax code (or VAT group) to be assigned to each customer.
Note: If you created your VAT company database using the Jump Start Data UK template, the system defaults this box to checked.

Require tax code on vendors: When checked, e-automate requires a Tax code (or VAT group) to be assigned to each vendor.
Note: The system only displays this field when the Consumption tax type field is set to Sales Tax and VAT or VAT.
Note: If you created your VAT company database using the Jump Start Data UK template, the system defaults this box to checked.

Use tax exemptions: When checked, e-automate allows customers, vendors, and contracts to be exempt from paying tax. The system displays below the Tax code (or VAT group) field in each of these records a Taxable (or VATable) checkbox and an Exempt code field. When the Use tax exemptions box is not checked, these additional fields are not displayed and all customers, vendors, and contracts are taxable.
Note: If you created your VAT company database using the Jump Start Data UK template, the system defaults this box to unchecked.

Require tax exempt code when not taxable: When checked, a tax exempt code must be assigned to each customer, vendor, and contract for which the Taxable (or VATable) checkbox is not checked. When the Require tax exempt code when not taxable box is not checked, the system does not require entry of a tax exemption code in the Exempt code field.
Note: This box is only active when the Use tax exemptions checkbox is checked.

In the Tax calculation engines region, select the tax engine you want to use and click [Configure selected tax engine].
Note: The system uses only one tax calculation engine at a time.  If you continue with this process and select a different tax engine, these steps will replace your currently selected tax engine (identified by a Yes in the Enabled column on the Tax calculation engines display) with the new tax calculation engine.

To configure the built-in tax calculation engine, do the following:

In the Enabled field, use the drop-down menu to select True.

In the Tax Rounding region select one of the following rounding options:

If you want to round tax by only the transaction, select the Round per transaction option.

If you want to round tax by tax authority and transaction, select the Round per tax authority per transaction option.

If you want to round tax by tax flag, tax authority, and transaction, select the Round per tax flag per tax authority per transaction option.

Click [OK] to save the tax calculation engine configuration settings.

To configure Avalara tax calculation integration, do the following:

In the Enabled field, use the drop-down menu to select True.

In the Trace field, use the drop-down menu icon to select False.
Note: This field is only set to True when using the Logging options on your computer to determine if there are bugs in the system, which requires an administrator. See your administrator or IT personnel for more information.  

In the TaxLiabilityGLAccount field, enter your sales tax payable account.

In the Url field, enter the URL you were given from Avalara.
Note: If you are using this database to test Avalara, be sure to use the URL for the AvaTax sandbox.

In the Account field, enter your Avalara account number.
Note: If you are using this database to test Avalara, be sure to use a test account number.

In the License field, enter your Avalara license number.
Note: If you are using this database to test Avalara, be sure to use a test license.

In the HideTaxResultWindow field, use the drop-down menu to select False.
Note: If this field is set to True, users will not see the Avalara popup window that depicts how the taxes were calculated with Avalara’s tax engine. If set to False, this popup window will appear with each transaction, confirming that Avalara is calculating taxes properly. Once the user is comfortable with the taxes charged by Avalara, they can change this field to True to no longer see the popup window with each transaction.  

Click the [Test connection] button. If the connection is successful you will see a success message. Click [OK] to acknowledge the successful connection.

To access the the Avalara Administrative Console, click the [Open admin console] button.

Click [OK] to close the Configure Tax Calculation Engine window.

Click [OK] to save the tax settings in the Options window.