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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Tax Posting Setup
Small and medium business | Business Central, N...
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Tax Posting Setup

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Posted on by AriaConsulting 2,655
Hey all,
 
I'm new to BC (BC version 22 currently) and doing an implementation for my own company (which is just me). Yes, I'm implementing an ERP for a 1-person company 😉. Why? A combo of I needed a new finance system, but I also want to learn BC from a professional perspective. To that end, I'm working through the MS Learn Learning Paths and doing setup and config in my environment accordingly. Because nothing beats hands-on learning, right?
 
So, with that preamble out of the way, I'm looking for some help to understand setting up the tax system and the MS Learn content is somewhat out of date so its proving a bit more challenging. I'm located in Canada so I need to setup for VAT (GST, PST, HST). My understanding from the Learn material is that I need to setup the intersection of the Business and Product Posting groups. But I'm unclear as to how many of these I need to setup, and what I should be creating/choosing for the different field values. What I have so far:
 
I don't know if I need the /BC PST/ entry, or if I need similar entries for the other provincial taxes like HST in Ontario and New Brunswick and such. I also don't clearly understand what these fields should have as values:
 
Tax Identifier, what should go here?

Tax Calculation Type, I don’t understand the difference between “normal” and “full”?

Unrealized tax Type, which should I choose for each record?

Tax Clause Code, what should go here?

Tax Category Code, what should go here?

Sales and Purchases FastTabs, do I need to select accounts here? What if I don’t populate these?

Thanks very much!
Categories:
Business Central
  • AriaConsulting Profile Picture
    AriaConsulting 2,655 on at
    Tax Posting Setup
    Thanks very much Shauna. Everything helps! 
     
    Follow up questions:
    1.  If I understand correctly I should create a record in the tax posting setup for each different combination where any of the Bus. Post Group, Prod. Post Group, Tax Calc Type, Unrealized Tax Type, or posting accounts change, correct?
    2.  Why would there be 2 additional fields with the same info as tax identifier? That seems....pointless 😏
    3.  In your screenshot, your first record has no Prod. Post Group. Is that the config for the basic "apply to everyone" (irrespective of product)? Which would seem to be the equivalent of the GST here because its federal. 
    Thank you!
  • Suggested answer
    Shauna Langley Profile Picture
    Shauna Langley 691 Super User 2024 Season 2 on at
    Tax Posting Setup
    Hi,
     
    I'm based in the UK but hopefully the theory of the setup translates the same.
     
    Tax Identifier, in the UK we would have zero and standard VAT, similar to tax.  If there is no VAT to be calculated then the vat identifier is set to Z and standard which is usually 20% is set to S.  This is usually a symbol to denote what vat/tax is applied so not sure what you use in Canada.
     
    Tax Calculation Type = Normal is when you buy or sell something that has vat/tax included, Full is when the transaction is only related to vat/tax so that the total value is vat/tax.
     
    Tax Clause Code = UK seems to set this up to be the same as the Tax Identifier
     
    Tax Category Code = UK seems to set this up to be the same as the Tax Identifier
     
    Sales and Purchase = You will definitely need to specify the sales and purchase vat accounts otherwise you will get an error when you try to post a transaction.
     
    The vat bus and vat prod posting groups will determine what vat/tax is due to be calculated.  Here is the UK if I sell a product to a UK customer then it will use the below to determine what vat to calculate.
     
     
    If the product has been setup as standard then 20% vat will be calculated and posted to G/L 56100.
     
    VAT Bus Posting Groups are attached to customer and vendors, vat prod posting groups are attached to items so the combination of these will determine how much vat is calculated.
     
    Hope that helps,
    Shauna

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