Freight & Taxes

[pfd]

We add freight by adding a freight line during Ship Confirmation. Depending on the Ship To location, Freight could be taxable. Right now the user manually figures out if the Ship To location is freight taxable. Is there an automatic way to setup the system to do this. So if Ship to location is freight taxable then it levies tax . If it is not then it does not levy tax.

Thanks,
Matt
OneWorld Xe,SP23

 

[tklemp]

I'm assuming that some of your customers must pay a sales tax, but do not pay a tax on freight. Otherwise, you could simply set up your freight line to be included in tax calculations (turn on the "Include in Tax 1" flag), and if your customer didn't pay sales tax, they wouldn't pay freight tax either (I believe it would come across as a 0% tax).

Otherwise, you could probably accomplish this with a small program change. If you have unused category codes in your address book, you could use one of these to store a "freight taxable" flag. Otherwise, you could create a file that would store this information. Then, when you add your freight line, add a small chunk of code to pull in the "freight taxable" status for that customer.

 

[pfd]

Thanks for replying, Todd.
The problem is there are some Ship To customers where the item is taxable and freight is taxable. There are other Ship To Customers where the item is taxable but the freight is not taxable. Is there a setup I can do to automatically handle this. IS there a place that I can specify that freight is taxable/not taxable for a Ship To address?
Right now we are handling this manually. If freight is taxable we add freight through a taxable line type . If freight is not taxable we add it through a non taxable line type. Problem is too may errors happen in this process.

Thanks,
Matt

 

[tklemp]

I'm not aware of any standard JDE functionality that lets you specify taxable freight by customer, we have the Transportation Management module, I didn't see it in there either (if I'm wrong, please let me know!).

As I said, your best bet is probably selecting an unused address book category code to specify taxable/nontaxable freight by address book number, then putting a mod into the ship confirm program to set the taxable flag correctly. Of course, with any solution involving changes to JDE's code, you'll need to balance the benefits to the business against the headaches of program maintenance.

 

[Devo]

If you are using a non stock item to represent freight, you can set up your tax rate tables to handle exceptions by item number. In your example, you would have to go into every tax rate code (P4008) that Freight is non-taxable and set up a duplicate record with the save name and define the tax rate by the item number that represents freight and assign it a 0% tax rate. You will need to make sure that the processing options behind the P4008 are set to validate against item number.

 

[mccracko]

Hi Matt,
Did you find a solution for this? We face the same issue and need to ensure we are billing correct freight tax amounts for each ship-to. Currently we use a UDC table to determine by state if the freight line is taxable or not Now we are upgrading to E1 and looking for a better solution.