Stop Tax Calculation Headaches with Acumatica
This video explains how to properly configure Acumatica to avoid tax calculation errors.
(a) Challenges
When a customer has multiple shipping addresses, especially in different tax jurisdictions, Acumatica can calculate taxes incorrectly. This can occur when a user overrides the default shipping address on a sales order. Although it seems convenient, overriding the shipping address can cause the taxes to be calculated based on the wrong location. This leads to a series of problems:
- Incorrect invoices: Invoices will reflect the incorrect tax amount.
- Payment issues: Customers may be overcharged or undercharged, leading to the need for refunds or additional payments.
- Time-consuming corrections: Fixing incorrect invoices and payments is a frustrating and time-consuming process.
(b) Solution and Benefits
The solution is to create a separate customer location in Acumatica for each shipping address with its own tax settings.
Here’s how it works:
- Proactive setup: For a customer with multiple warehouses in different tax zones, create a new location in Acumatica for each warehouse.
- Location profile: Each location profile includes the specific address and tax zone for that warehouse.
- Accurate tax calculation: When a sales order comes in, the user selects the correct location from a list. This ensures accurate tax calculation from the start.
Benefits:
- Compliance: Ensures accurate tax calculation and compliance with tax regulations.
- Efficiency: Saves time and eliminates the need for manual corrections or workarounds.
- Customer satisfaction: Prevents billing errors and frustration for customers.
- Improved Acumatica utilization: Leverages Acumatica’s built-in features to optimize your business processes.