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Tax Management ​

Comprehensive tax management ensures compliance across jurisdictions while optimizing tax positions. This guide covers tax configuration, calculation, and reporting in Angage ERP.

Understanding Tax Management ​

Tax Types ​

Transaction Taxes ​

  • Sales tax
  • Value Added Tax (VAT)
  • Goods and Services Tax (GST)
  • Use tax
  • Excise tax

Withholding Taxes ​

  • Vendor withholding
  • Employee withholding
  • Dividend withholding
  • Interest withholding
  • Royalty withholding

Property Taxes ​

  • Real estate tax
  • Personal property tax
  • Asset tax
  • Transfer tax

Tax Configuration ​

Setting Up Tax Codes ​

  1. Navigate to Finance → Tax Setup
  2. Click Tax Codes
  3. Create new code:
    • Code: GST-10
    • Description: Goods & Services Tax 10%
    • Rate: 10%
    • Type: Output tax
    • GL Account: 2150

Tax Groups ​

Combine multiple taxes:

Tax Group: RETAIL-NYC
- State Tax: 4%
- City Tax: 4.5%
- District Tax: 0.375%
Total: 8.875%

How-To Guides ​

How to Configure Multi-Jurisdiction Tax ​

Tax Nexus Setup ​

  1. Define nexus locations:

    • Physical presence
    • Economic nexus
    • Affiliate nexus
    • Click-through nexus

  2. Set thresholds:

    California: $500,000 sales
Texas: $500,000 sales  
New York: $300,000 and 100 transactions

  3. Enable tax calculation:

    • Auto-calculate rates
    • Apply exemptions
    • Track thresholds
    • Monitor compliance

Address-Based Tax ​

Configure tax determination:

  1. Ship-From Address

    • Origin-based states
    • Warehouse locations

  2. Ship-To Address

    • Destination-based
    • Customer location
    • Drop-ship address

  3. Tax Hierarchies

    • Country → State → County → City → District

How to Manage Tax Exemptions ​

Customer Exemptions ​

  1. Go to customer record
  2. Click Tax Settings
  3. Add exemption:
    • Certificate number
    • Exemption type
    • Valid dates
    • Jurisdictions
    • Products covered

Product Exemptions ​

Configure non-taxable items:

  • Food products (some states)
  • Medical supplies
  • Educational materials
  • Manufacturing inputs
  • Government sales

Certificate Management ​

Track exemption certificates:

  1. Upload certificates
  2. Set expiration alerts
  3. Regular validation
  4. Audit trail
  5. Renewal process

How to Calculate VAT/GST ​

VAT Configuration ​

For VAT countries:

  1. Standard Rate: 20%
  2. Reduced Rate: 5%
  3. Zero Rate: 0%
  4. Exempt: No VAT

Input/Output VAT ​

Track VAT flow:

Sales (Output VAT): €10,000 × 20% = €2,000
Purchases (Input VAT): €6,000 × 20% = €1,200
Net VAT Payable: €800

Reverse Charge ​

For B2B cross-border:

  1. No VAT charged
  2. Customer self-assesses
  3. Report EC sales
  4. Track by country

How to Handle Withholding Tax ​

Vendor Withholding ​

Setup for payments:

  1. Configure vendor:

    • Withholding rate: 20%
    • Threshold: $600
    • Tax ID required

  2. Process payment:

    Invoice: $1,000
Withholding: $200
Net Payment: $800

  3. Generate forms:

    • 1099 (US)
    • T5018 (Canada)
    • Local requirements

Employee Withholding ​

Payroll taxes:

  • Federal income tax
  • State income tax
  • Social security
  • Medicare
  • Local taxes

How to File Tax Returns ​

Sales Tax Returns ​

Monthly/quarterly filing:

  1. Generate Report

    • Period selection
    • Jurisdiction filter
    • Review transactions
    • Calculate totals

  2. Adjustments

    • Credits/debits
    • Rounding
    • Penalties
    • Interest

  3. File Return

    • Export data
    • E-file capable
    • Payment generation
    • Confirmation tracking

VAT Returns ​

  1. Run VAT report

  2. Box calculations:

    Box 1: Output VAT
Box 2: EC Acquisitions
Box 3: Total VAT due
Box 4: Input VAT
Box 5: Net VAT
Box 6: Sales value
Box 7: Purchase value

  3. Submit online

  4. Schedule payment

  5. Archive filing

How to Manage Tax Audits ​

Audit Preparation ​

  1. Documentation

    • Transaction details
    • Tax calculations
    • Exemption certificates
    • Filing history
    • Correspondence

  2. Reports

    • Detailed ledgers
    • Summary by period
    • Exception reports
    • Reconciliations
    • Adjustments

Audit Support ​

During audit:

  1. Export requested data
  2. Provide drill-down
  3. Show audit trail
  4. Document changes
  5. Track findings

Advanced Features ​

Tax Automation ​

Rate Updates ​

Automatic rate management:

  • Subscribe to tax service
  • Monthly updates
  • New jurisdictions
  • Rate changes
  • Rule modifications

Calculation Engine ​

Real-time tax calculation:

  • Product taxability
  • Customer location
  • Exemption status
  • Special rules
  • Multi-jurisdiction

Indirect Tax ​

Use Tax Accrual ​

For untaxed purchases:

  1. Identify transactions
  2. Calculate use tax
  3. Self-assess
  4. Accrue liability
  5. Include in returns

Import/Export ​

International tax:

  • Customs duties
  • Import VAT
  • Export documentation
  • Intrastat reporting
  • Commodity codes

Tax Planning ​

Optimization Strategies ​

  • Nexus management
  • Entity structuring
  • Transfer pricing
  • Credits utilization
  • Timing strategies

Scenario Analysis ​

Model tax impact:

  • New locations
  • Business changes
  • Rate modifications
  • Compliance costs
  • Cash flow effects

Tax Reporting ​

Compliance Reports ​

Transaction Reports ​

  • Taxable sales
  • Non-taxable sales
  • Tax collected
  • Tax paid
  • Exemptions used

Summary Reports ​

  • By jurisdiction
  • By period
  • By customer
  • By product
  • By tax type

Analytics ​

Tax Metrics ​

Monitor performance:

  • Effective tax rate
  • Compliance rate
  • Audit findings
  • Processing time
  • Error rates

Risk Assessment ​

Identify issues:

  • Missing exemptions
  • Rate errors
  • Filing delays
  • Threshold monitoring
  • Audit exposure

Integration ​

External Systems ​

Tax Services ​

Connect to:

  • Avalara
  • Vertex
  • Thomson Reuters
  • Sovos
  • TaxJar

Benefits ​

  • Accurate rates
  • Automated filing
  • Exemption management
  • Nexus monitoring
  • Compliance tools

ERP Integration ​

Seamless flow:

  • Order entry
  • Purchasing
  • GL posting
  • Reporting
  • Payment processing

Best Practices ​

Compliance ​

  • Stay current on laws
  • Document everything
  • File on time
  • Maintain certificates
  • Regular training

Accuracy ​

  • Validate addresses
  • Update exemptions
  • Review calculations
  • Audit regularly
  • Correct promptly

Efficiency ​

  • Automate where possible
  • Standardize processes
  • Central management
  • Regular reviews
  • Continuous improvement

Configuration ​

Tax Settings ​

Navigate to Settings → Finance → Tax:

  • Default Tax Code: Standard rate
  • Tax Calculation: Address-based
  • Rounding: Round per line
  • Integration: External service
  • Filing Calendar: Jurisdiction schedule

Compliance Setup ​

  • Registration numbers
  • Filing frequencies
  • Payment methods
  • Contact information
  • Service subscriptions

Troubleshooting ​

Common Issues ​

Incorrect tax calculation

  • Verify address
  • Check tax code
  • Review exemptions
  • Update rates
  • Test calculation

Missing transactions

  • Check date range
  • Verify tax codes
  • Review GL mapping
  • Check posting status
  • Run reconciliation

Filing errors

  • Validate data
  • Check formats
  • Review requirements
  • Update software
  • Contact support

Next Steps

Learn about Period Closing procedures for month and year-end.

Angage ERP Documentation

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