Output Tax in Customer Line Items
UseTax on sales/purchases is deducted from amounts in G/L account items and not from amounts in customer items. The tax on sales to customers is output tax and is posted to a tax account. In systems delivered to countries which have no tax on sales/purchases, the Tax code field is suppressed.
You can enter tax on sales/purchases for the invoice in the following ways: You can
The system posts one item for every tax code.
The following scenarios are possible when entering taxes:
The following figure shows the options available for entering a tax code in each customer line item.
The figure illustrates how a customer invoice is posted. The system posts the tax on sales and purchases (output tax) to the tax account automatically.
Most countries have more than one tax on sales/purchases rate. The tax return must include a separate line for each rate. You must therefore enter a different tax code for each tax rate.
For more information about tax on sales/purchases, see the documentation created specifically for your country. For details about preparing the tax returns for submission to the authorities, see FI Closing and Reporting.