How do Tax Codes work in VAT editions

The behavior Tax Codes in VAT editions is different than US editions.

Acctivate mimic's the behavior of QuickBooks when determining which tax code to use for a transaction.


For Sales Orders, the Tax Code used is selected based on this sequence:

  • The Sales Order's Tax Code on the Customer tab of the Enter Sales Order window is used if it is filled in. This acts as an override of the Product's sales Tax Code.
    • Note: This is defaulted from the Customer Ship To tab (found on the Ship To tab of the Edit Customer window), so assigning a Tax Code to a customer Ship To also acts as an override.
  • If no Tax Code is set on the Customer Tab of the Sales Order (whether manually set or defaulted from the customer's Ship To), the Product's (Sales) Tax Code will be used.
  • Finally, an order line's Tax Code can be overridden by the user. 


For Purchase Orders, the Tax Code used is selected based on this sequence:

  • The Product's Purchase Tax code is used by default.
  • Optionally, a PO level Tax Override can be selected at the bottom of the Enter Purchase Order window which will override all the lines.

Whatever is selected on the Purchase Order will carry over to the Purchase Invoice.

When entering other charges or Landed Costs in the Purchase Invoice window, the Tax Code selected on the Other Amounts tab will be used.