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Hi everyone,
I am searching for al solution/workaround to post sales tax depending on the delivery date.
The situation is as follows:
In month of March, the sales tax for an Item has to be calculated with 16% (100 EUR net + 16 EUR Sales Tax = 116 EUR gross)
Due to a change in sales tax by legal authorities, the sales tax increases in April to 19 % (100 EUR net + 19 EUR Sales Tax = 119 EUR gross)
So for the same customer/item-relation, the tax is different depending on the delivery date.
I have seen, that there is a possibility in the sales tax codes to give date ranges for the tax percentage:
This helps when posting the invoice: the system finds the correct percentage to post - oriented by the incoice date or document date.
So far, so good.
The problem in this case is, that in the current year, there have to be two different accounts for the tax itself (e.g. 1234 VAT Payable 16% and 5678 Vat Payable 19%) and two different reporting codes in the sales tax declaration (e.g. line 5 for sales tax 16% and line 10 for sales tax 19%).
As the described solution in giving date ranges for different percentages in one and the same sales tax code, there is no possibility to distinct between two different tax accounts nor two different reporting lines in the tax declaration.
Is there any smart solution or workaround how the system automatically adapts the correct sales tax percentage and uses different main accounts/reporting lines (except creating two differnt lines in the sales order for the same item)?
thanks in advance!
18.04.2021
Microsoft Update 10.0.15 PU42 brougt out an interesting-looking feature for this:
Hi Ludwig,
thanks for your reply - especially the hint with the cash discount is something to think about - thanks for that!
I will see if I can convince the customer to use one and the same account for the different percentages.
Still, the problem with the reporting lines in the sales tax declaration is open.
I will see how we can solve that and leave a feedback on this post about the way we solved it.
Best regards
Brenda
Hi Brenda,
I think there is no good and straightforward solution that can handle all possible scenarios in your case.
One of the reasons for that is because German's love cash discounts and when posting a cash discount a tax correction is necessary.
Now imagine, that the invoice was created in December 2020 but the payment was made in January 2021.
If you already changed the account setup in January, then the tax correction for the cash discount will go to the wrong account.
As Andre mentioned, there might be more scenarios that result in similar issues.
Therefore, it might be better not using separate accounts.
That's something people are used from local softwares such as Datev and that helps them reconciling their taxes.
D365FO allows doing the tax reconciliation differently, that is why I believe that you won't need separate ledger accounts.
Yet, that's something you need to discuss with the customer.
Best regards,
Ludwig
Hi André,
thanks a lot for your reply and sharing your solution.
Unfortunately we cannot adopt is as there are too many automated processes in posting sales invoices so that it is hard to filter sales invoices to be posted in the morning/afternoon.
Thanks anyway and best regards
Brenda
Hi Ludwig,
thanks for your reply.
Our customer wants the two ledger accounts to be able to cross-check tax postings and not to mix transactions with credit notes for March posted in April (which can be solved by using the "document date" instead of "invoice date"). But the cross-check-problem still remains.
The setup is for Germany (yes, I know: the change in tax-percentage will not be repeated that soon - hopefully!), but nevertheless our customer is looking for a solution.
But I think the bigger challenge is to route the tax amounts to a different reporting code.
I had the idea to do a manual correction of the tax ledger accounts by posting directly on the VAT code (while having two different sales tax codes, one fo 16% and one for 19%). But the problem is that the connection to all individual postings gets lost.
Maybe you have a better idea?
Thanks a lot in advance and best regards
Brenda
HI BPanthel,
The ledger account requirement makes it a hard story. A few years ago, I had the same requirement. We then used the date range to manage the new percentage on the current Tax code and changed the Ledger account. In addition, we created a new Tax code for the old rate with the old ledger account.
This is not solving all posting scenarios. The customer had to agree on when to post transactions for the date before the tax percentage change and after to keep using the correct ledger account. So, e.g. from 8:00-11:00 they used the old ledger account for older transactions and starting 11:30 till end of the day the new ledger account.
Hi,
Why do you need different sales tax ledger accounts?
For which country/region was this setup made?
Best regards,
Ludwig
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