How to Define Tax Types in Payables
Payables uses five types of taxes:
- Sales. Used to record sales tax charges on invoices and taxable invoice distributions.
- Use. A tax you pay directly to a tax authority instead of to a supplier. Suppliers do not include use taxes on invoices. By assigning use taxes to invoices, you can create a record of the taxes you owe to tax authorities. Review your use tax liabilities by running the Use Tax Liability Report.
- Offset. A negative-rate tax you use to offset a positive tax to allow you to record and report on zero-rated taxes. For example, an office in an EU state paying an intra-EU invoice can assign a VAT tax and a corresponding offset tax to an invoice, so it can record and report VAT taxes without actually paying any to the supplier.
- User-defined (VAT, GST). You can define in the QuickCodes window in Payables as many tax types as you require for your tax authorities and tax rates. Payables treats user-defined taxes as sales taxes.
- Automatic Withholding Tax. A tax you use to withhold taxes from expense reports and supplier invoices.
Define Payables Lookups – TAX TYPE
Level: Enterprise
Navigator: Setup > Lookups > Payables
Purpose: Create and maintain Lookups for TAX TYPE – this step is already completed for standard Oracle Tax Types.
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A prepayment is a type of invoice you enter to pay an advance payment for to a supplier or employee. For example, you may need to pay a deposit on a lease, or you may need to pay an employee an advance for travel expenses. You can later apply the prepayment to one or more invoices or expense reports you receive from the supplier or employee to offset the amount paid to them. You can enter either a Temporary or a Permanent type prepayment. Temporary prepayments can be applied to invoices or expense reports you receive. For example, you use a Temporary prepayment to pay a hotel a catering deposit. When the hotel's invoice arrives, apply the prepayment to the invoice to reduce the amount you pay. Permanent prepayments cannot be applied to invoices. For example, you use a Permanent prepayment to pay a lease deposit for which you do not expect to be invoiced. If you want to apply a prepayment to one or more invoices or expense reports, you must firs...
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