Conditional sales tax is paid to the tax authority when the payment is posted. In the following section, we will explore conditional sales tax setup, configurations, and entries.
The conditional sales tax is captured in the course of payment execution and, during the invoice transaction, the sales tax amount is posted to the conditional tax main account. It will then be reversed after posting the payment, and it will post the sales tax amount. The following diagram illustrates the high-level cycle of conditional tax from the perspective of both tax receivable and tax payable:
The conditional tax should be activated first, then the conditional sales tax code should be identified and attached to the conditional sales tax code in the sales tax group and item sales tax. The invoice document will inherit the sales tax group and item sales tax group, where the conditional tax will be posted. In...