Tax Calculation

premnav

Dear Colleagues,

We are using NAV worldwide version and I have a query with regard to Tax implementation. First I would like to explain how our authorities have structured the Taxation in our country using an example.

Let say sale price is 100; now we’ll see how tax is calculated on top of this net sale value.

Net Sales Amount = 100
Nation Building Tax (N.B.T) Amount (3%) = 100 *(3/100) = 3
Sales Value including Nation Building Tax = 103
Value Added Tax (VAT) Amount (15%) = 103 * (15/100) = 15.45
Total Value including VAT = 103 + 15.45 = 118.45

When you see the above calculation, you would notice that one tax component is applied on top of another tax component. In other words, VAT is calculated on top of both Net sale Amount and the Nation Building Tax Amount. My question is that whether the above tax mechanism can be implemented on NAV’s worldwide version without any customization?

I would also like to know the principle behind the Tax Groups and Tax Areas. Is there any possibility for us to implement our taxation policy using the Tax Groups and Tax Areas?

Your thoughts in this regard would be highly appreciated.

Thank you!
PREMNAV

rajatkalia

HI

I replicated ur scenario and it is very much possible without any customization.

Make a structure by 1st selecting Type = Other Tax. Since we do not have NBT so i defined NBT as Other Tax and select Calculation Type = Percentage. If the % is fixed 3% then define calculation value as 3, otherwise define the % in the transaction. Tick Include Base; Also in the Account No specify the GL A/C to which this NBT should post.
In the 2nd line, select Type = Sales tax; Base Formula = 1; Tick Include Base.

Select the Structure in transaction, specify other details and if % for NBT is not specified in Structure then click Invoice>>Structure, specify Calculation Value = 3.

Click Functions>>Calculate Structure values.

System will calculate the required details and net total of Invoice will be 118.45.

reema

premnav wrote:

We are using NAV worldwide version

rajatkalia , did u read above statement ?

the example what you have given is applicable for Indian localization( because structure concept is only for Indian localization)

devu_13

Reema is right in this way.because indian tax calculation only present in indian localization and for this here a particular codeunit define for tax calculation.

premnav

Hi Colleagues,

Thank you very much for your all suggestions.
In fact I believe that the above mechanism can be implemented even in the World wide version with Tax Area, Tax Groups & Tax Jurisdiction setup. Can anybody further elaborate on the feasibility on that? Your valuable suggestions are greatly appreciated.


PREM-NAV