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Dynamics 365 Community / Forums / Microsoft Dynamics AX (Archived) / Sales tax on PO isn...
Microsoft Dynamics AX (Archived)

Sales tax on PO isn't included in consumed budget

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Posted on by Nour Desoki 555

Hello All ,

I have a project with an original budget 1 Million legal entity currency on item category and creating item requirement then PO to do item transaction on this project.. PO net amount is 1000 legal entity's currency , item sales tax is 2% so when clicking on totals appears 1020. when i continue the process and consume directly on the project , Only 1000 is consumed not 1020..  the same to expense journal & Fee journal... According to Fee Journal i make it as chargeable so i want to tax on fee consumed from fee budget as well.

Is it logical system & business or there's setup for that??

Please help.

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I have the same question (0)
  • Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi Noureldeen Desoki,

    Does your company operate in a 'value added' tax environment - such as in most EU countries - where you can re-claim the tax included on purchases from your government or do you operate in a US-like sales tax system where sales tax is treated as an expense?

    Ludwig

  • Nour Desoki Profile Picture
    Nour Desoki 555 on at

    Hi Ludwig ,

    Neither Value added nor US. it's normal sales tax

  • Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi Noureldeen Desoki,

    ok. The sales tax that you charge your customer and that he pays you does it go into your own 'pocket' or do you have to transfer that tax amount to your tax authority?

    In account Terms: Do you post the sales tax on a Balance Sheet or Profit & Loss Account?

    Ludwig

  • Nour Desoki Profile Picture
    Nour Desoki 555 on at

    1. to tax authority

    2. balance sheet

  • Verified answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi,

    If the sales tax goes to the tax authority and if you are using a balance sheet account to track it, then it is ok in my opinion that AX only consumes 1000 instead of 1020. If you are still in doubt, have a chat with one of your tax accountants to be 100% sure.

    Best regards,

    Ludwig

  • Nour Desoki Profile Picture
    Nour Desoki 555 on at

    Thanks Ludwig for your reply & response , actually your point of view is totally logical , i will ask a customer about his logic of business.. thanks again

  • Community Member Profile Picture
    Community Member on at

    Lets just pretend, for my issue that is similar, that we have done our due diligence and have confirmed that it should be calculating to 1020 rather than the 1000.  What is the mechanism for making this work?

    My specific example is this.  We rent a piece of equipment, of which we pays sales tax on.  We are attempting to markup that entire invoice to charge the customer.  The issue we are having is that the sales taxes are being calculated correct on the "buy" side, but they are not on the "bill" side.  AX wants to only apply the markup on the rental cost.......not the rental cost plus sales tax added.

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