Value Added Taxes are organized by Tax Codes. Expense categories are associated with such codes, as are rates and percentage of recovery. The first step in building the VAT tax structure is to create the tax codes. The client should have a list of the codes used in its particular country or countries tax structure(s). To create tax codes:
- Expand Expense
- Under Expense, expand Taxes
- Click on Tax Code
- Click the Add button
- Enter a tax code ID (required).
- Enter a tax code Name (required).
- Enter a Tax Calculation method (required).
- Auto Compute Tax (used in case the tax needs to be auto calculated based on the amount, currency, expense type and location selected by the user)
- Sales Tax – No Auto Compute (allows free entry in the tax field
- If desired, enter a tax code Description
- In the Active box, check for Yes or uncheck for No to enable or disable the tax code.
- Click the Save button.
- Click the Back button.
- Repeat the above steps as necessary until all codes are entered.