Use the split tax functionality to create different tax rates within a single jurisdiction. This functionality typically applies to Tennessee state sales tax rules, but may apply to other states as well.
To split a tax rate:
From the Maintenance > Tax, Duty & Exchange Rates menu, select Tax Jurisdiction Code Maintenance to display the Tax Jurisdiction Code Maintenance window.
Populate the fields according to the Creating Sales Tax Jurisdiction Codes procedure.
From the Edit menu, select Split Tax Rates to display the Split Tax Rate Maintenance window. The split tax you create applies to the line item that the cursor was on when you selected to split rates.
In the Type field, press F10 and select from one of the following to determine how the system should apply the tax rate:
Item - Determines the tax based on the dollar amount of each single item on the order generation.
Extended - Determines the tax based on the extended dollar amount of each line item on the order.
Order - Determines the tax based on the total dollar amount of the entire order.
In the Maximum field, enter the dollar amount where the corresponding tax rate ends.
When you specify a maximum amount for a range of sales dollars, that same amount displays in the next line in the Minimum field. This is not a duplication. Keep in mind the following:
Any amount less than the maximum amount is taxed at the rate for that line.
Any amount equal to or greater to the maximum amount is taxed at the rate for the next line.
If you do not specify a maximum amount, the corresponding tax rate is applied to any sales amount equal or greater than the minimum dollar amount.
Note: If you enter 0 (zero) in this field, the system considers the line item, dollar amount, or sales order to be taxable. If you do not want to apply a taxable amount to a line item, dollar amount, or sales order, leave this field blank.
In the Rate field, enter the tax rate for sales amounts that are between the amounts in the Minimum and Maximum fields.
Note: If you enter 0.0 in this field, the system considers the line item, dollar amount, or sales order to be taxable. If you do not want to apply a taxable rate on a line item, dollar amount, or sales order, leave this field blank.
*Split * displays in the Max Taxable Per column to indicate that a split taxable rate applies to that line item.
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