Topic: Sales Tax and 1099 Reporting E-learning curriculum SAP Business One Topic: Sales Tax and 1099...
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Transcript of Topic: Sales Tax and 1099 Reporting E-learning curriculum SAP Business One Topic: Sales Tax and 1099...
Topic: Sales Tax and 1099 Reporting
E-learning curriculum
SAP Business One
Topic:
Sales Tax and 1099 Reporting
SAP AG 2003
Please review the following terminology and menu changes that apply in SAP Business One 2007:
As shown in demo: 2007
Jurisdictions, Values and Codes
Previous menu path:
Administration Definitions Financials Tax Define Sales Tax Jurisdiction Types
New menu path:
Administration Setup Financials Tax Sales Tax Jurisdiction Types
Previous form name:
Define Sales Tax Codes
Previous checkbox name:
Expenses
New form name:
Sales Tax Codes – Setup
New checkbox name:
Freight
1099 Reporting
Previous menu path:
Reports Financials Accounting 1099 Report
New menu path:
Reports Financials Accounting 1099 / 1096 Report
2007 - Sales Tax and 1099 Reporting
SAP AG 2003
Create multiple levels of Tax Jurisdictions from ‘City’ to ‘Federal’
Set default values for Business Partners and Items
Create Sales Tax Reports
Setup 1099 Definitions
Create 1099 Reports and submit them
At the conclusion of this topic, you will be able to:
Topic Objectives
SAP AG 2003
Tax Jurisdictions, Values and Codes
Step 1 - Define Sales Tax Jurisdiction Type: Administration > Definitions > Financials > Tax
Step 2 - Define Sales Tax Jurisdiction Values: Administration > Definitions > Financials > Tax
Step 3 - Define Tax Codes: Administration > Definitions > Financials > Tax
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Default Codes: Customers, Items and Services
A/R, Customer Record:Tax codes are associated with customer locations. By default, tax codes are based on the ‘Ship-to Address’ of a customer in the Business Partner Master Record.
A/P, Items: For Item Invoices, the default tax code is based on the default tax code for the Warehouse receiving the goods. This can be found using the following path: Administration > Definitions > Inventory > Define Warehouses
A/P, Services:For Service Invoices, it is based on the default tax code of the company which is under Administration > System Initialisation > Company Details > ‘Accounting’ tab
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For each item your business buys or sells, you can decide if the item is taxable and also by default, whether tax is calculated ‘normally’ or on a ‘Use Tax’ basis.
Setting up default behaviour for Inventory Items
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‘Use Tax’ Option
Normal Tax
No Tax
Use Tax
These options can be sent by clicking on the Purchasing Data tab on the Item Master record, and changing the ‘Tax Type’ field.
The warehouse used in the A/P document must be defined as ‘Allow Use Tax’. Otherwise, the journal entry for the ‘Use Tax’ item will behave as a ‘No Tax’ Item.
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Depending on the Goods or Services supplied, default tax codes are generated appropriately.
Customers/Sales Invoices:
For Items and Services it is based on the ‘Ship-to’ location of the Goods
Vendors/Purchase Invoices:
For Items, it is based on the warehouse where the Goods are shipped to
For Services, it is based on the company’s default tax code
Overriding Defaults:
Can be done for tax on any line item
How Tax is calculated in an Invoice
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Sales Tax Reporting
You can choose to run tax reports either by one or more Tax Jurisdictions or Codes.
You can also choose ranges of dates, source of tax documents, and printing options.
The Tax report can be found under the following path: Reports > Financials > Accounting > Tax > Tax Report
SAP AG 2003
1099 Reporting Features
Unlimited 1099 Form and Box combinations
Primary 1099 Form and Box values supplied
Ability to specify default 1099 types for vendors
Opening balances feature
Edit 1099 Form/Box/Amount functionality
Minimum 1099 reporting definition
Submit at year end
Appropriate 1099 Reports
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Setting up 1099 Forms, Boxes and Values
Step 1 - Define 1099 Table:
Administration > Definitions > Financials > Define 1099 Tables
Comes with main form types, others can be added
Step 2 - Setup 1099 Boxes:
Click on ‘1099 Boxes’
Optional: You can specify Additional Expenses for which you want to include in your 1099 calculation. These can be set using the following path:
Administration > System Initialisation > Document Settings > General Tab > Tick ‘Manage Expenses in Documents’ > Click on ‘Define Expenses’
Step 3 – Specify 1099 Minimum Values
Fill in the ‘Minimum 1099 Amount’ field then click on OK. This can be done for each form/box combination for every vendor prior to running any reports
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Setting up default codes for A/P - Vendor Record
You can specify if a vendor is subject to 1099 processing and the default form and box values to use in invoices. As 1099 information is recorded at the document level, the user can override the default value invoice entry, or edit them later.
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1099 Opening Balances
You can manually enter 1099 Opening Balances that represent the total amount already processed in your old system. This can be done for each unique vendor/form/box combination. This can be found under the following path:
Administration > System Initialisation > Opening Balances > 1099 Opening Balance
This process will not create a journal entry
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How 1099 is calculated
1099 becomes due on amounts paid not on amounts billed.
Invoicing Stage:
1099 Form and Box types are specified at the invoice entry stage
1099 type may be edited later
Payment Stage:
After payment, 1099 appears in default reports
Opening Balance Transfer:
Items entered into the ‘Define 1099 Opening Balances’ window will be included in the 1099 calculation amount
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Editing 1099 information before and after payment
Before PaymentBefore Payment
1099 form and box information can be changed
After PaymentAfter Payment
1099 form and box information can be changed, as well as amounts
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1099 Reporting
To access 1099 Reporting, use following path:
Reports > Financials > Accounting > 1099 Report
Double-click on a row in the report to access the vendor detail by transaction
Click on the ‘Print’ icon to submit the 1099 Report
SAP AG 2003
Topic Summary
Create multiple levels of Tax Jurisdictions from ‘City’ to ‘Federal’
Set Default values for Business Partners and Items
Create Sales Tax Reports
Setup 1099 Definitions
Create 1099 Reports and submit them
You are now able to: