Taxes overview

There are several pages to determine the tax rates and categories for your company and the business entities with whom you work.

Although some settings are delivered by Sage, it's a good idea to review each page and the related settings to be sure they meet your specific business needs.

If your legislation is not delivered, see How to set up a custom tax solution below.

In this section you can:

Set up a tax category

  • Define the type of tax for a specific legislation.

For French and German legislations, Sage delivers the VAT tax for purchasing and sales documents.

If no category is assigned when importing, such as for US legislation, taxes are imported in the Placeholder category.

Manage tax rates for your legislation

  • When you create a tax rate, you need to link it to a tax category and a legislation.

Define item tax groups

  • Items in a group use the same tax settings and rates. On the Item page, on the Financial tab, you can then select an Item tax group to avoid manually entering the tax on each document for this item.

Set up country groups

  • Country groups facilitate tax determination rules. Countries in the same group share tax determination rules so you don't need to set up rules for each country.
Sage provides 3 country groups:
  • European Union (EU): Countries that follow EU Commission rules
  • Countries outside EU: Countries that do not follow EU Commission rules
  • All countries: Countries included in your solution

Define tax determination rules

  • Tax determination rules include details like flow, purchasing or sales; origin and destination country; transaction type; item tax group; and so on. Use these rules to identify a tax rate for an item depending on the document.

Create a tax zone

  • For legislations such as the US, you can set up tax zones that include multiple sales tax categories including city, county, state, and special taxes. Use a tax zone to simplify tax applications for sales.

How to set up a tax custom solution

If your country or legislation is not delivered, you can create a customized tax solution.

First, on the Country page, add your country and select an existing tax solution. For example, you could select a legislation with the same currency.

Next, on the Tax solution page, select the tax solution you associated with your new country. You see it included in the Countries field.

Create a new Tax solution for your new country.

You can create tax categories, rates, tax determination rules, and so on.

When you've completed the tax solution set up, return to the country record on the Country page, and replace the Tax solution with the one you just created.

You're now ready to create the company in this country, which includes adding sites, contacts, locations, and other details as needed.

If you integrate with Sage Intacct, you need to add the new country to the Sage Intacct configuration page on the Defaults tab.