Help

5

Calculating Tax for Exempt Customers on Sales Order

Avatar
shaun

My retail prices including tax are stored in the Product Sale Price field. The tax Code for my Taxable Customers ST11 is set to Tax Included in price. I also sell to Tax Exempt customers and have created a Fiscal Rule. The issue is that when entering a Sales Order the price is still based on the product Sale Price field but the tax does not get deducted.

Tax Codes

ST11 -> 20% [TAX included in price]

ST2 -> 0% Exempt Sales

Fiscal Rule Exempt Customer -> Map -> ST11 to ST2

Product A Sale Price £120

Customer A Taxable

Customer B Exempt - > Fiscal Rule applied

(1) Sales Order selling product A to Customer A

Product A £100 Tax £20 = £120 correct

(2) Sales Order selling product A to Customer B

Product A £120 Tax £0 = £120 incorrect Price should be £100

I would like to keep the Product Sale Price as Tax Included.

What is the best way to set OpenERP to calculate the prices correctly for Tax Exempt Customers?

1 Comment
Avatar
Discard
Avatar
shaun
-

One way I have found of implementing this is to create a new price list - Tax Exempt Customers - based on the Taxable Price List and then setting the calculation fields to New Price = Base Price * ( 1 + -0.1667) + 0.00 (Note 0.1667 is negative). I then assign the customer to the price list and the 20% tax is removed by means of calculation.

2 Answers
0
Avatar
shaun
Best Answer

The solution of creating a price list to to calculate the correct price for Exempt customers is not complete. The reason being that some of the products that I sell are Zero Rate (0%) . Therefore based on a calculated Price list to remove TAX you get the following scenario.

Product A Tax Code ST11 (20%)

Price £12 (£10 ex TAX)

Product B Tax Code ST0 (0%)

Price £12 (£12 ex VAT)

Customer B Exempt - > Fiscal Rule applied + Assign to calculated price to remove TAX

Product A Price £10 correct

Product B Price £10 incorrect as product B is Zero Rated with a price of £12

This begs the question of "What is the point of a Tax Code with a setting of TAX included in Price?" unless there is a way of Mapping between Fiscal Positions

Does this mean that to set up OpenERP correctly all prices should be EX TAX?

1 Comment
Avatar
Discard
Avatar
shaun
-

Is it possible to use the Taxes -> Special Computation Field to calculate the price on logic. ie IF (tax_code = ST11 and ST11_tax_is_included) {Price = Price - ST11_TAX} ELSE {return Price} . Will this create problems with tax reports? Can any one provide me with an example?

0
Avatar
patrick
Best Answer

Your solution is possible, but I wonder why you want your product prices to be with tax included?

If you would create the prices without taxes, openERP is able to do the tax-calculation correctly, depending on the country of the customer and the existence of the VAT number of the customer. This way, the tax-exempt customer might get a receipt with tax included, but he can get it back from the customs.

1 Comment
Avatar
Discard
Avatar
shaun
-

I am a retail supplier and hence all my customers require the prices inclusive of VAT. I am also using the magento ERPconnector. As I had set the prices in Magento as inclusive of VAT when I imported the products into OpenERP they were based on these values. However, it also seems a bit strange functionally associating TAX codes as Included in Price as this would have been better set at product level and then Taxation could be calculated easier between Taxes. I thought there was a setting elsewhere in the configuration that I had missed.