Customer/Shipto Tax Information -Example 

The following section explains how you would set up a new customer and then update the customer when a RESALE certificate is received from the customer.

You set up a new customer in California.  The system defaults the Taxtype for the new customer to RETAIL, and the Taxcode defaults to CA9.  You do not yet have any resale certificates on file for the customer.  You save the new company record.  At this point the customer is set up as taxable.  If an order is entered for the company using the customer or a different address, the system would apply tax based on the RETAIL Taxtype and the rate in the appropriate Taxcode record (CA9 if the shipment is to the customer billing address,  another taxcode if the order is shipping to a different zip with a different taxcode.

The customer submits a resale certificate for California, and indicates all California sales to the customer are for resale purposes.

In this situation, you would do the following to change the customer to a Resale customer in California.

      Set up a new shipto address record for the company for California, if one does not already exist.  The Shipto Taxtype would be defaulted to RETAIL based on the customer record, but you would change the Taxtype to RESALE based on the resale certificate sent to you by the customer.  The Taxcode in the shipto would default to the appropriate Tax Authority based on the zipcode in the shipto address.

      Set up a Sales Tax Certificate record for the Resale certificate.  This is done using the Sales Tax Certificate Lookup (which is accessed from the Shipto Address Detail panel). The Sales Tax Certificate Lookup allows you to create and to edit the resale certificates associated with a specific customer, and to assign these resale certificates to shipto records for the same state.  When a resale certificate is associated with a specific shipto, the system loads the tax number and expiration date from the Tax Certificate into the Shipto record.

      If the customer already has shipto records in the system for the state in which the Resale Certificate is received, you would also review and update the other shipto records for the state as required (change the Taxtype in the records to resale and assign the tax certificate to the RESALE shipto records as appropriate).

This logic handles situations in which the customer is Retail in one state and Resale in another because the shipto address controls what tax information is used for each order.

This logic can also handle situations where a customer is purchasing for both RESALE and RETAIL in a specific state at one specific address.   In that case, two shipto records can be created for the shipto address.  One Shipto is setup as RETAIL and used for taxable sales to the customer, and the other Shipto is setup as RESALE and is used when the customer is purchasing goods for resale.


Sales Order Creation and Editing