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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / TAX Rate Change impact...
Finance | Project Operations, Human Resources, ...
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TAX Rate Change impact on Sales Invoice

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Posted on by Vinayak Hegde 27
There is a tax % change from Jan 2024 from 20% to 21%. Tax value and effective date updated and it is working fine for the invoices issued in current year and following year. Problem we are facing is if we issue credit note in 2024 for the original invoices belongs to 2023 system calculates new rate 21% not 20%. How we can fix this issue.
 
Sample : 
 
Invoice # 123 Dated 26-11-2023 Value 1000+ tax 200=1200 This is okay
Invoice #234 Dated 15-Jan-2024 Value 1000 + tax 210 = 1210 This is okay
Credit Note # 123CR dated 10-Jan-2024 Value 1000 + tax 210= -1210 (Ideally this need to calculate old rate because invoice issued with old rate)
  • Hana Xue Profile Picture
    Hana Xue Microsoft Employee on at
    TAX Rate Change impact on Sales Invoice
    Hi,
    As Andre said, you can set different tax codes and item tax groups. Create a new tax code that contains the old tax rate. Make sure you associate it with the appropriate accounting period. And create a new item tax group to associate the old tax rate. You can refer to the following link:
    Set up tax codes - Finance | Dynamics 365 | Microsoft Learn
    Set up item tax groups - Finance | Dynamics 365 | Microsoft Learn
    Best Regards,
    Hana
  • André Arnaud de Calavon Profile Picture
    André Arnaud de Cal... 291,861 Super User 2024 Season 2 on at
    TAX Rate Change impact on Sales Invoice
    Hi Vinayak,
     
    You can setup another tax code and tax item group for the old or the new tax rate. Then using a different tax item group, you can always manage which rate to use.

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