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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Tax on shipping address
Small and medium business | Business Central, N...
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Tax on shipping address

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Posted on by Honey98 292
Hi team,
 
I need to set the tax on shipping address for my client. so is the tax is already getting calculated on shipping address or do I need to do another set-up for it. I have mention the tax area code on customer and from there it takes the tax details on SO and it calculated the tax and showing up on SO. but when I'm mentioning the same tax on shipping address it does not show on the SO. is there any set-up for it ?
 
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Dynamics 365 Business Central
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  • Suggested answer
    OussamaSabbouh Profile Picture
    OussamaSabbouh 10,972 Super User 2026 Season 1 on at
    Hello,
     
    In standard Business Central, sales tax is calculated only from the Tax Area Code on the Sales document header, which comes from the Customer (Bill-to), not from the Ship-to Address. The Ship-to Tax Area Code does not drive tax calculation in standard BC, so changing it won’t affect the Sales Order — this is expected behavior, not a missing setup. Ship-to–based tax calculation only works if you use an external tax engine like Avalara AvaTax (or specific localizations); otherwise, there is no standard setting to make BC calculate tax based on the shipping address.
     
    Regards,
    Oussama Sabbouh
  • Suggested answer
    Dhiren Nagar Profile Picture
    Dhiren Nagar 2,675 Super User 2026 Season 1 on at
    Hi,
     
    I hope you are mentioning US version of Business Central here considering your mention of Tax Area Code.
     
    So I've been using US Taxation for sometime now and Yes, If you define Tax Area code and Tax liable Boolean on the Ship-To address master of the customer and if you select the Ship-To as Alternate Shipping Address, also selecting Ship-To code, in that case system will auto replace the Tax Liable Boolean and Tax Area code field on the Sales Order. Hence now the tax will be calculated based on updated values on Sales Order.
     
    There is no other setup other than Defining the Tax area code Ship-To address master as well as selecting it in the Shipping tab in Sales Order. So make sure you have selected Ship-To field as Alternate Shipping Address and Ship-To code as your Shipping Address code.
     
    May be try a scenario in latest version in Sandbox.
     
    I hope this helps.
     
    Regards,
    Dhiren.
  • Suggested answer
    YUN ZHU Profile Picture
    YUN ZHU 98,014 Super User 2026 Season 1 on at
    Hi, hope the followiong helps as well.
    Set up Use Tax and Purchase Tax in the US version
    Field Description
    Tax Liable Select to set up tax liability. Important: This field is available on the Purchase Header page, but it isn't shown by default. To select the field, you must first add the column that shows this field. You can change how certain UI elements are displayed. For more information, see Personalize Your Workspace.
    Tax Area Code The tax area code of the vendor. Important: This field is available on the Purchase Header page, but it isn't shown by default. To select the field, you must first add the column that shows this field. You can change how certain UI elements are displayed. For more information, see Personalize Your Workspace.
    Tax Exemption No. The company's tax exemption number. You can enter a maximum of 30 alphanumeric characters. Important: This field is available on the Purchase Header page, but it isn't shown by default. To select the field, you must first add the column that shows this field. You can change how certain UI elements are displayed. For more information, see Personalize Your Workspace.
    Provincial Tax Area Code The tax code for the province. Important: This field is available on the Purchase Header page, but it isn't shown by default. To select the field, you must first add the column that shows this field. You can change how certain UI elements are displayed. For more information, see Personalize Your Workspace.
     
     
    Thanks.
    ZHU

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