Sales Tax: Price-Dependent Taxes
Tax FAQs | Tax Reports | Tax Overview
Point of Sale supports the collection of sales tax based on the item unit price. The price threshold can be set up as a minimum price, maximum price, or price range that triggers the collection of tax. You can collect tax on the entire price of the item or just that portion of the price that falls blow, exceeds, or is within the specified price range.
Combined with Point of Sale's multi-rate tax option, you can define a tax code with almost any combination of price thresholds and tax rates to meet the tax requirements of one or multiple taxing agencies.
To set up price-dependent taxes:
Follow the general instructions for add/edit a tax code in company preferences.
On the Tax Options page of the Tax Code wizard, select either Price-dependent single-rate tax or Multi-tax rate, depending on your needs.
Follow the on-screen instructions (select Help if necessary) in the wizard for assistance in setting up your price thresholds and options.
If tax is collected only on the amount exceeding the price threshold, or within the specified price range, be sure to select the check box indicating such.
Example price-dependent, single-rate tax setup
Select Save.
When done configuring your taxes, be sure to assign tax codes to applicable items in inventory.
Notes:
If setting up a multi-rate price-dependent tax code, select the Test button on the last page of the wizard to verify the taxes collected at various prices.
If an entire department is subject to the price threshold, assign this tax code as the default department tax code in the department record. In this way, all new items added to the department are automatically assigned this tax code.
If you use multiple tax locations, adding a tax code to one location adds it to all of your locations. If the taxing instructions need to be different for each location, select Edit Tax Code under affected locations and revise the instructions that apply to that location.
If taxable shipping charges are assigned this tax code, the threshold identified here applies to shipping amounts as well. If shipping amounts are not subject to a threshold, set up and use a different tax code for them. See collect tax on shipping amounts for more information.