Overview:

When you go through the Install Application Data  process you will see a default set of tax rates added to your environment.

A Tax Rate is used on various transactions on the system and will effectively track your tax liability reporting and compliance including your VAT Liability.

Create, Edit And Update Tax Rates

There are time when you will need to create or edit your tax rates.  Editing existing tax rates will only apply to any new transactions you post to the system where you use your new or updated tax rate.

Follow these steps to Create a new tax rate:

1. Navigate to the Tax tab
2. Select  New to create a new tax rate.
3. In the Tax Rate field enter the percentage that will be taken as Tax.
4. Enter a name for reference in the Tax Rate Name.
5. Tick the Default Tax Rate if this is the tax rate that will be loaded as the tax rate on transactions
6. Select the Type of tax as this will determine which VAT Box your tax rate will appear on
7. You can link it to another tax rate in the Linked Tax Rate, for determining the rate and VAT Box to display the transactions in your VAT Return. This is only used for Reverse Charge tax rates.
8. Tick the Active box to begin using this tax rate.
9. Click Save to create the tax rate.

How will the tax Type be included in a VAT Return (UK Only)

The default Zumzum Financials. UK Tax Rates will automatically be picked up for your VAT Return and reconciliation process . This is based on the Type field on the Tax record. You would need to pay close attention to this field if you are creating or editing tax rates.

The table below displays if the tax rate will be included in the VAT return. In a nutshell, all tax types will be included in the VAT Return, except the Non Vatable tax type”.