To reach the Basics page, select FILE and BASIC PROGRAM SET UP from the Menu Bar.  Click on the "Sales Tax" tab on top of the page.  The Sales Tax Set-up page will appear.

Parts of this screen include:

Primary sales tax rate (if any)

Type in the amount of sales tax charged in your state or province.  To indicate the tax, use a decimal.  For instance, to indicate 5% tax, type in ".05".  To enter a 6.5% tax, type in .065.  If there's no sales tax in your state, type in "0".  If, at sometime in the future, your state changes the sales tax rate, you'll be able change the rate.  As shown, below, the primary sales tax rate is automatically entered on the Main Purchase Order Screen each time you create a new PO.

The Primary Sales Tax percentage is automatically entered on the Main Purchase Order Screen each time you create a new PO.

At what purchase order do you want this tax rate to begin?

The tax rate, if there is one, will start with the purchase order number that you enter in this blank.  If at a later time, your state or province changes the tax rate, enter the new rate and the purchase order number at which this new rate will begin.  The old rate will be applied to all previous purchase orders, while the new rate will be applied to all new purchase orders.  One important note:  the purchase order number that you enter in this blank MUST exist.  Before entering the new rate, double check which purchase order you'll be using for the starting purchase order number.

Code to use for your primary tax rate. - Level II - III

If you must change the tax rate depending upon vendor or the vendor's location, you can set-up a code for each tax rate.  A particular code can be tied together with a vendor so that when you paste the vendor, the tax code comes with it.  You would indicate the most commonly used tax code in this field.  There's also another reason for using tax codes.  If you're a Canadian or European AnyPO user, you can set up special tax codes that take in account more than one tax, i.e. Province and GST tax.  Additionally, you can calculate tax on the selling price plus the first tax which is required in some Canadian provinces.  When you have tax situations like this, even if you only use one tax, you'll want to use tax codes.  The primary tax code is entered in this field.  To set-up tax codes, click on the "Variable Rates."  For more information, see Tax Codes.

Does sales tax include shipping?

Some states, provinces or government agencies require that you calculate sales tax on the total of the goods plus shipping.  If your government agency does not require you to figure tax on shipping, then select NO.  If your government agency requires you to figure tax on shipping, then select YES.

To Set-up Other Tax Rates:  Variable Rates

If you must deal with more than one tax rate depending on where and from whom you obtain supplies and equipment, click on this button to set up the rates.  For more information on how to set up different rates, see Tax Codes.

Automatically check the Taxable box on all new PO's - Level II - III

Normally, you add tax to a PO by placing a checkmark in the 'Taxable?' box on the bottom of the Main PO Screen.  If all PO's (or almost all PO') you issue should be taxed, you may wish to automatically have the taxable box checked every time you start a new PO.  To do so, place a checkmark in this box.

NOTE: That if you select a vendor from the Vendor Pop-up List on the Main PO Screen, AnyPO will use the vendor's tax setting instead of this setting.  In other words, this automatic tax setting will only work for those vendors that you will be manually entering on the Main PO Screen.

Accounting method required for sales tax reporting

If your state or government agency has no requirements, use the same accounting method as you normally use for your business (see above).  For the great majority of businesses this will be the Accrual system.  In an Accrual Based system of accounting, any purchase order whether it has been paid or not is considered a sale.  A Cash Based system, on the other hand, does not consider an purchase order a sale until it is actually paid.  An Accrual Based system is easier to use--and is the one required by many tax agencies for calculating sales tax.

Rounding threshold when calculating tax

The Rounding Threshold allows you to adjust between two primary tax calculation methods:  "bracketing" and "rounding rule" systems.  Bracketing has been around for a long time and is utilized by government agencies because it generates extra tax revenue.

For example, typically you round up to the next whole number when the fraction (or rounding threshold) is .5 or more.  In a bracket system, however, rounding may occur when the fraction is .26 or more.  Or rounding may occur when the fraction is .01.  Since bracketing systems are common, past versions of AnyPO used a midway threshold of .26.

At first glance, a low rounding threshold doesn't seem to make a big difference.  But if you apply a low rounding threshold to thousands of transactions involving millions of dollars, it turns into a sizeable sum.  That's the reason why the bracketing system has been utilized by government agencies.

Lately, however, a number of states and international government agencies have been moving to the "rounding rule" system whereby tax is rounded at a fraction of .5.  If you know that your tax agency uses "rounding rules," use .5.  If you are under a bracketing system and know the threshold, type it in.  If you're unsure and are a past AnyPO user, you may wish to stay with .26.  Finally, if you're mystified by all this, use .5.

Helpful Hint

For Level II and III users, when you are on the Main Purchase Screen, you can obtain information on how tax is calculated.  To do so, double-click on the tax amount and the "Tax Calculation Information" box will appear.  Let's say the tax is 27.01.  Double-click on 27.01.  AnyPO will display an informational box with details on how the tax is calculated.  This is particularly useful if you must deal with two or more taxes on one PO.  Here's what the "Tax Calculation Information" box looks like: