1 Topic by aRTx (edited by aRTx 06/03/2015 08:32:45 am)

  • aRTx
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  • From: Albania
  • Registered: 10/29/2014
  • Posts: 47

Topic: How to handle this problem with tax-es?

How to handle this problem with tax-es?

This is something tax over taxes.

If there is an ITEM and the price before taxes for it is 2000 when I buy it from outside of my country (IMPORT in my state) then there are three tax-es like:
1. Value of excise (this will add some value to the base price like plus 1000euro, new price = 3000)
2. Customs Tax 10% (3000*0.10=300, then new price = 3300)
3. Tax 16% (3300*0.16 = 528, then the new price = 3828)

When I sell that same product I need only the last Tax 16% after my margin of profit p.s 20%
Then my price before tax = 3960 (becasue 3300 * 1.20)
The Price after tax16% = 4593.60 (because 3960 * 1.16)

Look the screenshot:
[img]http://i571.photobucket.com/albums/ss158/aRTx/TaxOverTax2.jpg[/img]

As you can see I'm using three tax-es to buy and only one tax to sell!
How to handle it?
I try to read WIKI Tax System but I don't know how to do it.

  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
  • Posts: 6,094

Re: How to handle this problem with tax-es?

Are you offsetting inward taxes with outward taxes like in VAT where only the difference is payable?
The taxes in FA are only for sales.
The purchase taxes need to be handled as part of total cost (debit COGS) and credit supplier.

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