Set up AP Taxcode information 

Determine your accounts payable tax reporting and collection requirements, and implement the accounts payable tax processing system as described earlier in this document.  The Accounts Payable system allows you to specify a taxcode for each vendor, accounts payable invoice, and a/p invoice distribution line.  The taxcode information defaults into each invoice from the Vendor Master file during invoice entry and this default vendor taxcode can be changed as required for each invoice or each invoice distribution line. 

The taxcode system records the taxcode used for each invoice and invoice distribution line and it can also be set up to automatically create tax distribution lines for vat and other tax amounts that need to be posted to the general ledger.  These options are discussed in more detail in the Accounts Payable Tax Processing section of this document.

Since the tax processing system can be used for reporting only and for reporting and automatic tax calculation, the system can be used for vat processing (which requires tracking the taxcodes used on each invoice and automatically posting amounts to specific vat accounts in the general ledger), and for situations that require only reporting (1099 reporting requirements in the United States would be a good example of a reporting only situation).

The basic steps involved in implementing the Tax Processing system are as follows.

Review the Tax Processing Documentation and determine which tax codes you need to set up in the system based on your tax reporting and collection requirements.

If you are implementing the accounts payable tax processing code on system that was running an older version of Stream V, a cut-off date should be determined and the implementation should be scheduled in order to coincide with a month or quarter end.  This simplifies the conversion by determining the date on which the system starts using the new method.

Set up the Generic Code Tables used by the Tax Processing System.  The Generic Code tables should be loaded with the Taxcodes that you determined in the previous step.  There are three Generic Code Tables used by the system.  One controls and validates the Taxcode field in the Vendor records, one controls and validates the Taxcode used in each AP Invoice or Register record, and one controls and validates the Taxcode field in each JE or AP distribution line.   The three tables are normally set up with an identical set of taxcodes, and the table used for the AP distribution or JE lines also contains the information used by the system when creating tax lines automatically (this includes the rate to be used and the autopost number of the general ledger account the tax is posted to).  The Gencode tables are normally created at the month or quarter end to prevent forcing users to select a Taxcode before the system is completely implemented.  If desired, the Vendor Gencode table can be set up in advance in order to allow the Taxcode to be loaded into the vendor records before Taxcode assignment is made mandatory in accounts payable entry.

Three Gencode Tables are used by the Accounts Payable Tax Processing system.  One table (F80:75) is used to define the valid Taxcodes that can be assigned to vendors in the Vendor Master File.  The records in this table restrict the Taxcodes that the operator can select from, and they force the operator to assign a valid Taxcode (if not already assigned) to each vendor as each vendor record is saved.

The second Gencode Table (F82:41) is used to define the valid Taxcodes that can be used on an accounts payable invoice.

The third Gencode Table (F46:30) is used to define the valid taxcodes that can be used on the distribution lines that are created for each invoice.

All three of the above Gencode tables should be loaded with identical information as indicated below.

 

Field	Description
Table	Contains the table name F80:75, F82:41, F46:30
Code	Code describing the tax code.  Examples might include VAT1, VAT2, 1099
Description	Description of the tax code.  Examples might include Vat1 – 7.5%, Vat2 – 3.0%, 1099 required.
Data_1	Tax rate for the tax code if applicable.
Data_2	Autopost of the JE Account this tax is charged to.
Data_3	Autopost of the JE account that a second negative tax line should be charged to.  The Data_3 information is optional and used for special vat processing situations in Europe where two offsetting vat lines are posted on a single invoice.

Note:  As soon as the Gencode Tables for the AP Invoice and AP Distribution lines are created, the system will begin requiring the user to specify a taxcode at the invoice and distribution line level.

More:

Set up Vendor Defaults