Steps:
In this demonstration, a tax scheme with multiple tax components is
created. To set up tax schemes with two or more components, setup
the components first using the Tax Component menu option.
Step 1: Setup tax components
| Tax Component 1: | 15.3% Excise Tax on Diesel Fuels |
|---|---|
| Tax Information: | |
| Tax Code: | Kentucky Sales Excise Tax |
| Tax Description: | Kentucky Sales Excise Tax |
| Account Code Description: | Sales Tax or another payable account code |
| Tax ID Number: (optional) | |
| Country: | United States of America |
| Tax Based On: | Percent of Sales/Purchases |
| Decimal Round Up: (optional) | 2 |
|
Apply On: |
Extended Price |
| Computation Rules: | |
| Percentage of Goods and Services: | 100% |
| Minimum taxable amount: | 0 |
| Maximum taxable amount: | 99,999,999 |
| Percentage of Tax/VAT to apply: (e) | |
| a. Flat Rate: | 15.3% |
| b. Postal Rate: | Tax Rate from postal code. See Also: System Setup > Postal Codes |
| Minimum Taxable Amount: | 0 |
| Maximum Taxable Amount: | 99,999,999 |
| Tax Component 2: | 1.4% Additional Tax on Diesel Fuels |
|---|---|
| Tax Information: | |
| Tax Code: | Additional Tax on Diesel Fuel |
| Tax Description: | Additional Tax on Diesel Fuel |
| Account Code Description: | Sales Tax or another payable account code |
| Tax ID Number: (optional) | |
| Country: | United States of America |
| Tax Based On: | Percent of Sales/Purchases |
| Decimal Round Up: (optional) | 2 |
|
Apply On: |
Extended Price |
| Computation Rules: | |
| Percentage of Goods and Services: | 100% |
| Minimum taxable amount: | 0 |
| Maximum taxable amount: | 99,999,999 |
| Percentage of Tax/VAT to apply: (e) | |
| a. Flat Rate: | 1.4% |
| b. Postal Rate: | Tax Rate from postal code. See Also: System Setup > Postal Codes |
| Minimum Taxable Amount: | 0 |
| Maximum Taxable Amount: | 99,999,999 |
Step 2: Setup tax scheme
| Tax Scheme: | Kentucky State Excise Tax on Diesel Fuel |
|---|---|
| Tax Information: | |
| Tax Code: | Kentucky State Excise Tax on Diesel Fuel |
| Tax Description: | Kentucky State Excise Tax on Diesel Fuel |
| Country: | United States of America |
| Tax Type: | Sales |
| EC Goods and Service: | NA |
| EC Sales or Purchase: | NA |
| EC Notional Rate: | NA |
| Tax Components: | |
| Selected Tax/VAT Component: | Kentucky Excise Tax on Diesel Fuel and Additional Tax on Diesel Fuel |
So that:
Extended Price: $250
Rate from tax component:
1. Excise Tax on sales: 15.3%
2. Additional tax on sales: 1.4%
15.3% (Excise tax) + 1.4% (additional tax) = 16.7%
$250 X 16.7% = 41.75
$250 + $41.75 = $291.75
Next Steps:
-
Assign default sales or purchase tax. See Also: Customer Class Templates | Customers Ship To Class Templates | Supplier Class Templates
-
Maintain sales or purchase tax. See Also: Other Tax Options