This chapter explains how sales and purchase taxes are processed in DBA and paid in your financial accounting system.
DBA has its own taxation system
DBA has its own taxation system, which includes taxable and non-taxable tax codes, tax authorities, default sales and purchase tax codes, and tax code exceptions at the customer, item, and supplier level. The tax system is designed to accommodate international VAT/GST and USA style taxation.
AR and AP Voucher Transfer values include taxes
The AR and AP Voucher amounts are tax inclusive. You do not enter taxes or track tax details in your financial accounting system.
Tax liability totals are transferred to your main general ledger during GL Summary Transfer
When sales order lines are invoiced, tax amounts are posted to your Sales Tax Payable liability account. When purchase order lines are invoiced, tax amounts are posted to your Purchase Tax account. The GL Summary Transfer is used to transfer these liability account totals to your financial accounting system.
When you file your taxes with Tax Authorities
Create a payable for your tax liability in your financial accounting system
Whenever you are required to file and pay your tax liability, you create a payable in your financial accounting system to your tax collection agency for the Sales Tax Payable and Purchase Tax liability associated with the reporting period.
Use DBA data views and reports for supporting detail
The Sales Tax Payable and Purchase Tax account totals represent your total tax liability, but the supporting tax code detail required on your tax filing forms is manually entered using information from data views and reports in DBA.
International Reporting
For international VAT/GST taxation reporting, the Tax Code Activity report is typically used, which provides summary tax code totals or detailed tax code totals by invoice.
USA Reporting
USA taxation reporting is confined to sales tax reporting. The Sales Tax Summary data view is typically used, which can be used to format any number of reports to suit your requirements.
