Taxes are determined and calculated in sales order entry programs in the following fashion. Taxes with effective dates based on zip codes are calculated using the shipping date of the sales order.
* Taxes will not be applied to items with the taxable flag set to off in program ICSM, Inventory Sales Data Maintenance.
* The taxable flag can be overridden in the sales order entry programs. If the taxable flag is set to on for a sales order line item, taxes will be charged for the item depending on the customer.
* The customer may be assigned a tax exemption group on the customer record. Tax exemption groups are setup by product code. If the customer is assigned a tax exemption group and a tax exempt number has been entered for the customer, the system will look at the item record to see if the ordered item is assigned to a product code assigned to the tax exemption group.
* If the item is assigned to a product code assigned to the tax exemption group, no tax will be charged for that item.
* If the item is not assigned to a product code assigned to the tax exemption group for the customer, then tax will be charged for the item.
* If the customer is assigned a tax exemption group, but no tax exempt number has been entered, the customer will be charged tax.
* To determine what tax code will be used when tax is charged, the system first looks at the ship to record for the customer. If a ship to record exists, the system will use that tax code.
* When the ship to code is changed on a sales order, the tax code is updated to the tax code from that ship to code.
* If no ship to record exists for the customer, or if the ship to record is SAME, the system will use the tax code on the customer record.
* Tax percentages cannot be changed on sales orders.