A customer tax matrix defines whether a specific product, price group, product line, or product tax group is taxable or non-taxable by ship to location or all locations. Tax matrices that you set up for a specific customer override the default tax structure. This is useful if for example, you need to apply tax to a product in one state, but not another. In that case, you would make the product non-taxable, but create a customer specific tax matrix for the taxable state.
If you want to apply a different tax code to orders for a single Ship To location, you can do so on the Ship Tos page of the Customer Master. Each Ship To has a Tax Code and Taxable status that can override the main Tax Code and Taxable status set on the customer. For more information, see Set up customer Ship To locations
Tip You can also update the tax matrix with changes you make to taxable status during order entry.
To enable this option, go to File>Company>Master: Sales, and set the Retain Taxable status for Cust/Prod in S/O value to Y.
Then, when you select or clear the Taxable option for a product during order entry (Sales>Order>Sales Order: Details) ,
you will be prompted to retain this taxable status for the customer.
To add the taxable status of the product to the customer's tax matrix, click Yes. :
- Go to File > Customer > Master.
- In the Customer box, find the customer you want to edit by typing the name, number, address, or phone. If the data for your customer does not appear automatically, press the Tab key.
- From the Setup page, click the Tax Matrix tab.
- Click Edit.
- Click the Add Tax Matrix button.
- Complete the options in the New Tax Matrix pop-up:
- Select the Ship To location that you would like the matrix to apply to. Leave blank to apply to all Ship To locations
- Type the Product, and type or search for the Price Group, Product Line, or Tax Group that you would like this taxable status to apply to.
- Click OK. You can now assign the taxes to the matrix you chose:
- If the matrix is taxable, select the Taxable check box.
- From the Tax Column list, select the tax column percent the Additional Tax Percent will affect. If all tax columns, select All.
- Type the Additional Tax Percent that the customer will be charged. This percent will be added to the existing percent in the tax column you selected from the Tax Column list .
- Click Save.
To view the percentages associated with each column of the customer's tax code, go to File > Customer > Tax, and for more information, see Create tax codes.
The tax matrix is added to the Tax Matrix grid for this customer and will be used (as applicable) for all subsequent order entries.
- Go to the Tax Matrix page as described above, and then click the delete icon at the end of the Tax Matrix row you want to remove.
- Click Save.