Include Tax into Fixed Asset Value

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Posted on by MahGah

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Hey everyone

Per GAAP in USA /Fixed assets should be recorded at cost of acquisition. Cost includes all expenditures directly related to the acquisition or construction of and the preparations for its intended use. Such costs as freight, sales tax, transportation, and installation should be capitalized. /

But in BC when we add Fixed Asset in Purchase Order as Taxable and with Tax Area Code then after posting BC only post the $ Excluded Tax as a the value for Fixed Asset. But we want the Tax also be included in the value of FA.

Is this possible and if it is not what is the reason?

Note: I know if you select Use Tax in Purchase Line then system does the right behavior but that only can be used if vendor did not charged for tax.

Thanks for your help

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Dynamics 365 Business Central

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Valentin Castravet 31,505 Super User 2025 Season 2 on at

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If you go to Tax Jurisdictions -> Tax Details, there is an Expense/Capitalize field. If you make this true then the system will include tax as part of the fixed asset acquisition cost.

To make this work you can setup a separate Tax Group Code that is used for fixed asset acquisitions and has the Expense/Capitalize set to true.

Valentin Castravet
Work: Zander ERP Services
Blog: Dynamics 365 Business Central Insights
LinkedIn: www.linkedin.com/in/valentin-c-0500a247/

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Yi Yong 2,588 Super User 2025 Season 2 on at

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Hello MahGah,

I am unfamiliar with US GAAP accounting rules, so please let me know if I am wrong.

From the below sample, it look seems like you can account it without posting to tax account.

https://floqast.com/blog/book-fixed-asset-journal-entry/

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YUN ZHU 95,748 Super User 2025 Season 2 on at

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How about using FA Journal for adjustment? But this requires manual adjustment every time.

For example,

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MahGah 15,529 on at

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Valentin Castravet

Awesome. That works perfect. Thanks for the suggestion.

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Valentin Castravet 31,505 Super User 2025 Season 2 on at

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Valentin Castravet

Awesome. That works perfect. Thanks for the suggestion.

Great! Please mark the post as verified

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MahGah 15,529 on at

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I have tried that many time but it get stuck and just showing spinning wheel :(

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