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Sales Tax on a Vendor Invoice

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Posted on by Imari

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How to apply sales tax to a vendor invoice? We have a vendor invoice that has a sales tax. We don't usually apply sales tax but this invoice needs to have one. Could you please assist in providing the instructions on how to do so?

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Dynamics 365 Business Central

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YUN ZHU 76,911 Super User 2025 Season 1 on at

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Sales Tax on a Vendor Invoice

Hi, If it is W1 version, the tax rate is determined by the combination of VAT Bus. Posting Group and VAT Prod. Posting Group in VAT Posting Setup.

Although not recommended, you can post taxes directly to the GL Account on the Purchase invoice line.

Hope this helps as well.

Thanks.

ZHU
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Valentin Castravet 25,642 Super User 2025 Season 1 on at

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Sales Tax on a Vendor Invoice

What country or localization of Business Central are you using? Tax set up will be different based on your specific country or localization.

Valentin Castravet
Work: Zander ERP Services
Blog: Dynamics 365 Business Central Insights
LinkedIn: www.linkedin.com/in/valentin-c-0500a247/
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Khushbu Rajvi. 7,593 Super User 2025 Season 1 on at

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Sales Tax on a Vendor Invoice

Hope this helps as well: https://learn.microsoft.com/en-us/dynamics365/business-central/finance-work-with-vat
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Mustafa Omerbegović 1,188 Super User 2025 Season 1 on at

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Sales Tax on a Vendor Invoice

Hello Imari,

If you are targeting basic sales tax, you will need to make certain setup and create relevant posting combinations to get desired VAT entries. You can find more details at the link below where the use of taxes is explained.

https://learn.microsoft.com/en-us/dynamics365/business-central/finance-work-with-vat

Later, visit the link https://learn.microsoft.com/en-us/dynamics365/business-central/finance-setup-vat

If you have more specific question regarding VAT setup I am at your disposal,

Greetings