Tax Code Determination 
In sales and purchasing documents, you must specify a tax code for items and services that are liable for taxes. SAP Business One proposes a tax code by default, which depends on the localization you are using.
For all localizations except Brazil, India, Israel, and Puerto Rico, you can set up tax code determination rules that take precedence over the tax information in the business partner or item master data, and G/L account determination. When you create a sales or purchasing document, the application proposes a tax code for each item line based on the rules you defined, but you can overwrite this proposal.
In tax code determination, you can do the following:
Define tax code determination rules
Update tax code determination rules
Delete tax code determination rules
Change the order of tax code determination rules
Define tax code determination rules for freight charges
For more information, see Working with Tax Code Determination Rules.
If you do not define tax code determination rules, the tax code is determined as follows:
Localization |
Item type documents |
Service type documents |
|---|---|---|
US and Canada |
Default tax code from warehouse |
Default tax code from company details |
Chile, Costa Rica, Guatemala, Mexico |
Default tax code from G/L account determination |
Default tax code from G/L account determination |
Other localizations |
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