Open Forum

Expand all | Collapse all

Sales Taxes in NAV

  • 1.  Sales Taxes in NAV

    SILVER CONTRIBUTOR
    Posted Jul 25, 2019 01:50 PM
    Hello Everyone,

    We've been working only as B2B, and we will begin doing B2C, does anyone have any experience with the input and output of sales tax percentages based on Zipcodes and how to go about ensuring those are updated regularly with back-end reporting to all the different states and counties?

    ------------------------------
    Caity Ross
    Prominate, Inc.
    Atlanta
    ------------------------------
    Conference-BCNAVUG_200x200


  • 2.  RE: Sales Taxes in NAV

    TOP CONTRIBUTOR
    Posted Jul 26, 2019 02:45 AM

    We had a different programmer analyst redeploy Wolters Kluwer Sales Tax Office to Navision.

    It  is working quite effectively now and you do not have to add in zip code ranges to a Tax Matrix.

    You identify a  Local tax Area Code as STO_ALL  at the customer Bill to, Sell To and Ship to Level.

    STO_ALL will populate sales and use tax for any US states and Canadian provinces you establish as active on the STO server

    If you add a state all you have to do is add the two character state abbreviation code as active on the STO server side and it will use 
    the perfect address file to create a tax record with the appropriate tax parameters.

    They can also file your taxes, which we are moving  to implement shortly.

    The operational issue you need to modify is not use the standard Navision RMA system to process customer returns. 

    Navision treats the customer as the Point of Origin, and return to your plant as the Point of destination, which is not compatible 
    with the sales tax software. Navision needs to rethink the process.  Sales returns are a reversal of the economic transaction based on the original 
    sales order and invoice. Leave the original Origin and Destinations linkages intact do not flip them. 



    ------------------------------
    Michael Heatherly
    controller
    Lesman Instrument Company
    BENSENVILLE IL
    ------------------------------

    Conference-BCNAVUG_200x200


  • 3.  RE: Sales Taxes in NAV

    SILVER CONTRIBUTOR
    Posted Jul 26, 2019 10:54 AM
    Most companies fear tax setup and functionality and will look to an outside add-on to ensure accuracy and updates with regulations, etc. (such as Wolters, as recommend in the replies here).  However, by using the Tax Jurisdiction, Area, Group and Tax detail tables  you can create the tax rates by Zip code on your own.   As you mention in your post, it is keeping the rates updated and getting them setup that can be cumbersome.  There are soooo many different rates depending on zips,etc.    I found California to be one of the most complex with thousands of records to load in order to get all the jurisdictions to link correctly.   Cumbersome, but doable.  Don't fear!

    Use Rapidstart to import the rates and correct setup connections in the detail table.   Avalera has a paid subscription where you can receive a file of all tax rates  by zipcode that is almost setup perfect for RapidStart.  Some minor formatting, and your import file is ready.  When you have an active subscription, you receive updates with changes to rates across the entire US.    I seem to recall that USPS also has an efficient table of rates that can be manipulated into a correct format for RapidStart without any charge.

    Let me know if you want more detail on how I have setup the jurisdictions and ares for past clients.

    ------------------------------
    Jamie Constantine
    Columbus
    Scranton
    ------------------------------

    Conference-BCNAVUG_200x200


  • 4.  RE: Sales Taxes in NAV

    Posted Jul 29, 2019 10:52 AM
    Setting up the zip codes is bad enough, but don't forget the Tax Groups on your items. The Tax Group codes need to be detailed enough to properly designate your items in every state.

    Each state may have different definitions of what is taxable or not. In MN, clothing is not taxed, but sporting goods are not defined as clothing. So running shoes would not be taxed but cleats would be. If you sold both, you would need two different Tax Groups. In states that did not define this difference, the two groups would have the same rate.

    In WI, if you sell taxable goods, freight is taxable. What a mess.

    ------------------------------
    Ted Johnston
    IT Director
    Streicher's
    Minneapolis MN
    ------------------------------

    Conference-BCNAVUG_200x200


  • 5.  RE: Sales Taxes in NAV

    TOP CONTRIBUTOR
    Posted Jul 29, 2019 11:13 AM
    Wolters Kluwer STO has an extensive commodity definition Item Group Codes that are assigned to items records and the taxability by state
    is controlled by the STO server.

    We distribute Process Control Instrumentation and utilize 7 codes of the several hundred defined .





    ------------------------------
    Michael Heatherly
    controller
    Lesman Instrument Company
    BENSENVILLE IL
    ------------------------------

    Conference-BCNAVUG_200x200


  • 6.  RE: Sales Taxes in NAV

    SILVER CONTRIBUTOR
    Posted Jul 30, 2019 10:56 AM
    First, it's important to speak with your accountants about whether you will have economic nexus in all states/counties or not.  Based on the recent "Wayfair" supreme court ruling (https://www.salestaxinstitute.com/sales_tax_faqs/wayfair-economic-nexus), the rules for nexus have been clarified.  It's something like $100,000 in sales or 100-200 transactions in that state, but it varies by state.  It will be important to consider how much business you will be doing online and where the majority of your customers are located.  We started out with only having nexus in our own state, so we were able to manage that by using the tax jurisdictions in NAV and doing our own sales tax reporting.  However, as our business grew, we realized that our business in other states was going to meet the threshold for nexus, even though we didn't have a physical location or employees in those states.  When faced with the complexities of tax law in every state and county, we opted for a third party solution to help us manage that.  As a ballpark, I have found that those third party solutions will cost between $20k and $60k on an annual basis (if you have them calculate taxes and do reporting), so if you're not doing a ton of online business from the start, that might not be worth it for you.

    Disclaimer: I am not an accountant, tax specialist, or anything of the sort.  Please speak with an expert before you proceed! :-)

    ------------------------------
    Angela Dunnahoe
    Marucci Sports
    Baton Rouge LA
    ------------------------------

    Conference-BCNAVUG_200x200


  • 7.  RE: Sales Taxes in NAV

    Posted Jul 30, 2019 12:21 PM
    As a VAR we have implemented Tax Jar and Avilara.  Tax Jar is less expensive but doesn't offer the same level of audit support,  Avilara has extensive audit and filing support but is quite expensive.  These outside services provide the tax jurisidiction rate updates for you via web services.  Once its implemented you don't have to worry about rate changes.

    ------------------------------
    Cris Searle
    Partner
    OfficeOps
    Carlsbad CA
    ------------------------------

    Conference-BCNAVUG_200x200


  • 8.  RE: Sales Taxes in NAV

    Posted Aug 06, 2019 12:02 PM
    Hi Caity,

    I am a Solution Architect with Wolters Kluwer and their tax solutions mentioned below. As many people have said the first step would be to identify your tax requirements​ as they stand now that you're selling B2C. Now with the Wayfair ruling there's a good chance that you will have nexus in most states if you exceed either 200 transactions or 100k in revenue. Keep in mind your B2B business will apply to those thresholds as well. If you're in a majority of those states it really will be required to have some level of automation. Manually configuring the NAV tax tables for 1,000's of tax codes is not feasible. Wolters Kluwer has a data solution which you could work with to import and automatically create the tax codes which is a great "entry level" solution. It will help save a lot of time and improve your accuracy, but it has limitations you can't solve for that you will still face.

    The most accurate solutions available are web service based solutions which we call Sales Tax Office (STO) or SureTax. With these solutions the calculations are executed outside of NAV in real-time and are built to handle all sales tax nuances. Something simply can't replicate with NAV standard functionality. They can also easily be plugged-into up stream systems like an eCommerce platform or CRM so that you have a consistent tax calculation throughout or order to cash process. If you would like to understand more, please reach out and I would be happy to get you in touch with the right person.

    ------------------------------
    James Karst
    Business Analyst
    Wolters Kluwer
    Wichita KS
    ------------------------------

    Conference-BCNAVUG_200x200


  • 9.  RE: Sales Taxes in NAV

    SILVER CONTRIBUTOR
    Posted Aug 06, 2019 12:28 PM
    Hey James,

    Thanks for the reply. We actually spoke last Thursday with you and Meghan :)

    ------------------------------
    Caity Ross
    Prominate, Inc.
    Atlanta
    ------------------------------

    Conference-BCNAVUG_200x200


If you've found this thread useful, dive deeper into User Group community content by role