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Taxability by payer not customer
John Panzenhagen *MUGA
BC:

Question:

Article:

Taxability by payer not customer

Categorized as:

order management
M3
ERS
cloud

I don't know if this is something that will need to be an enhancement request, or if we are just missing a setting. I would like your feedback on it.

Description
We do a lot of warranty work where payment is split between the customer and the manufacturer. The invoice split process works fine, but the taxable code is being selected based on the customer’s ship to address for the invoice and not the payer. When the payer is non-taxable and the customer is taxable, the split  Read more...portion of the invoice is also taxable. The taxable code should always be based on the payer and not the customer.

Business Impact
This is a situation that happens every day. We currently have a report that runs daily that lists the invoices with the incorrect taxable code. We have a person in accounting who will then go into each invoice and manually correct the taxable amount. Accounting spends 30 minutes to 1 hour per day correcting these invoices.

Work Around
A daily report lists incorrect invoices. The incorrect invoices are manually updated. Show less...
order management
M3
ERS
cloud
Group: *MUGA
1
4
73
Latest msg: Thanks for the suggestions. My issue is that we believe that the payer should be used for determining whether or not it is tax exempt. it ignores the ... from John Panzenhagen, on 01/08/2025

Comments (4) (Descending Chronological Order)
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John Panzenhagen
BC:
Thanks for the suggestions. My issue is that we believe that the payer should be used for determining whether or not it is tax exempt. it ignores the payer and bases it on the delivery address of the customer even though the customer isn't paying.
Loretta Bennett
BC:
We are using M3 and have ship IDs that are taxable and items that are taxable only by a customer . Most of our customers are Tax exempt. We use TXS050 and CMS017 . The priority in TSX050 is linked to sequence 10 in CMS017. Then on CRS610 and OIS002. We use the Geograph code as zip code to set the tax. Put a ticket in with Infor for how to set it up for your situation.
1
John Panzenhagen
BC:
Thanks, William. We are only using M3 to manage sales tax. Wouldn't a customer that is tax exempt be tax exempt regardless of the state?
William Bolin
BC:
If you are using a 3rd party tax calculator (Vertex) to mange the tax calculations and exemptions, the rule for that can be configured into the calculator itself pretty easily.

I don't know the configurations that would be possible if you were using basic M3 sales tax functionality, but I feel like that would be very complicated when you have to consider that exemptions are considered state-by-state so a delivery to Missouri would still be taxable if the payer was exempt in Texas.

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