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Does anyone have more info on how suitetax determi...
# taxes
m
Does anyone have more info on how suitetax determines tax nexuses on sales than https://suiteanswers.custhelp.com/app/answers/detail/a_id/64714 ? That seems like an incredibly flawed diagram missing an unbelievable amount of information.
As an example we have a salesorder being shipped to Sweden but it's Tax Nexus says US - CA (our default). If I set a Location (which should be the ship FROM of Portugal the tax nexus switches to Portugal). But the Tax Nexus should be Sweden
k
It is a bit complicated matter. from what you are saying your customer is in CA but they want you to ship to Sweden, is that correct?
Basically your customer needs to provide you with nexus they have so you would add them to their record. that will allow you to assign the appropriate tax item to your sales transactions
m
our customer is in Sweden
our subsidiary is located in US-CA though
k
that’s your subsidiary, right? not your customer’s. So something is off with your set up for your customer’s nexus, Take a look at that.
m
It seems to match whatever the Location added on the sales order is, or falls back to our default nexus. The Location field is the ship FROM address though. We add Sweden as the ship TO on the sales order. I don't think customers have nexuses? They have a tax registration for Sweden
If i add Portugal as the Location with the same customer and same ship to then the nexus changes from US-CA to Portugal. But it should be Sweden the whole time
k
m
Thanks, yeah that's the Tax Registration for Sweden that's set up for them already. It just wasn't it's own Nexus subtab
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(but just for anyone looking at this thread, issue is not resolved. Netsuite still is incorrectly using the ship FROM country on sales transactions to determine nexus)
k
see this logic. Somewhere in this top row you are missing your setup
m
Yes that's the help doc I linked to initially which I was asking if anyone had more info because that doc is not clear at all to us
It makes no sense that the tax nexus is being determined by the Location field on a sales order, which is the Ship From on that doc. So basically we just fundamentally disagree with that logic, which is not the same as the logic from legacy tax, where tax nexus was properly being determined by ship TO (in our experience)
So I'm trying to figure out any additional information about any one of those steps, like 'Is Ship From Country tax based on Ship From'. What does that mean? Hoping to find more help documentation
k
right, it does not tell you what exactly is missing in your confgs, you just need to see if each decision point is reflected in your configs. and no, Location does not determine your nexus
m
or second step, 'Is Ship To country based on Ship From'... how could that be? Those are two different things
But I'm directly experiencing that Location determines Nexus from every test
k
Ship From Country tax based on Ship From = if you are basing your Nexus in the Ship From Country = US for you
m
in edit mode on a sales order i change the Location field and the Nexus changes
but the tax nexus should never be determined by the ship from country for sales orders? In general?
k
it depends. In Israel sellers have to pay VAT for certain customers, for example
not your case through, but it does exist
m
Okay sure I can understand there being a couple of exceptions but according to my accounting team it shouldn't be relevant for any of their test cases (in this case ship to Sweden on that sales order)
k
did you set up your sub’s Nexus? do you have tax rates available for Sweden? What country is the customer’s ship to address? too many questions/uknown
m
No that's all helpful. I went through and set up all the nexuses so we have Sweden yes, but I see accounting hasn't filled in the Tax Reg. Number for Sweden which maybe is the issue... The tax rates are available yes (Avalara so a single rate per country). Ship to is Sweden (screenshot from that test sales order)
Nope, added the tax reg number to that subsidiary nexus but still tax nexus on sales order is being determined by Location field
k
They need add tax reg numbers, otherwise SuiteTax ignores is and default to blank for the customer (but apparently not for Location which we really do not care about, what if there is no location..)
m
Yeah, customer has swedish tax reg, subsidiary has swedish tax reg. Ship to on record is Sweden
And yet it's still a direct 1-1 i change the Location drop down and the tax nexus changes
Oh sorry I missed that question, if no location then it falls back to our subsidiary default (US-CA) even with ship to as Sweden and tax reg numbers set
k
what subsidiary “has swedish tax reg”?
m
our default subsidiary (the one on the transaction)
added it
k
being thick - sorry. Are you a Swedish sub selling to Swedish customer? or are you an American sub selling to Swedish customer ?
I do get your have your subs set up with proper Nexuses
m
No worries at all I very much appreciate your time/advice. US sub registered in Sweden selling to a swedish customer
but for example if i change the Location on that sales order to be some address in Portugal the tax nexus will switch to Portugal too
(or literally any country that's in the Location field it seems)
We do have nexuses set up for all of these countries on the subsidiary (though all missing tax reg numbers other than sweden right now). The customer is only set up with a swedish tax reg number / ship to address
k
I do not work with locations (inventory) but…. is there a ST preference for Locations vs Customer? Do not recall 😞
m
We're all non inventory items for resale
k
oh, but location?…. just for classifications? check anyway?
m
I'm sorry I don't quite understand the question. If you're referring to how we populate the Location fields it's the ship from address from the provider (we're a marketplace so everything is drop-shipped and non-inventory).
k
locations have a special place in NS because they have this inventory functionality which is unadvisable to use for service companies….
m
no Location is added to the item. No class or department either
We add all currencies to every item. The default subsdiary + "Include Children", otherwise we pretty much only set the item name/number and display name/code fields
k
ok. Have you checked the tax rates working properly (associated with the tax code used on the customer’s record)?
m
What tax code on the customer record? I don't think that's something we have / set
k
I thought there was one…. I do not have an instance with ST right now.. I might be mixing it with Legacy
m
Sorry to take a step back, the real issue we're having is sending a Sales Order from our native system to Netsuite and trying to save it. Avalara + Suitetax is giving us the error
Copy code
Unable to save the transaction due to an error being reported by the tax calculation engine: This Document has used AvaTax Services. Currency conversion cannot be used with documents taxed in multiple countries
and won't let us even save the record. Of course avalara has no help documentation mentioning this issue so I've been digging into it. The rabbithole I've been down here is noticing that the nexus is not setting correctly on sales orders in general. For this failing test transaction (ship to Sweden, ship from Portugal) if I don't set the line item Location fields then it saves fine, just with the wrong Nexus which is what sent me down this path
My thought was that the location being set is causing the nexus to change, causing avalara to try to calculate twice for the same record but with different nexuses. But it shouldn't be changing since the nexus should be determined by the ship TO address we set before setting any line items... leading to this whole investigation
k
but you are saying you do not have Location on the SO, so it should impact nothing
and if you have ST + Avalara.. it is the whole new ball game
m
we do set locations on the SO line items
k
yeah, I should have asked when you posted the Nexus setup,,
oh, you do have Locations on the SO but not on the item, got it
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m
yeah I do agree Avalara is a wrinkle but I was trying to focus on the netsuite suitetax tax nexus determination solely , though did i totally misunderstand that Avalara tax engine is actually the one doing the nexus determination in this case?
I assumed it was suitetax (non engine related) doing the nexus determination
All this said, and with all your time spent I wonder if this is all just a red herring to the issue and that it's something in avalara itself related to advanced tax rules (not sure how yet though)
k
yes, Avalara’s role is to determine the appropriate tax rate based on the available setup; you have everything set properly as I can tell but nada, so ask Avalara
m
sure enough... the accounting folks turned off 1 advanced rule and thought it would somehow all keep working without explaining to me what they did
k
love it
m
Sorry for taking up so much of your time, really appreciate your patience and expertise
I am still curious about how the tax nexus stuff is working because I would like it to set based on ship TO but doesn't seem to be stopping the correct calculation of taxes
tax nexus of US CA but sales tax 25% is swedish VAT rate
tax code expected would be AVATAX-SE not AVATAX but at least it's working. Also seems like the line item location (vs header location) isn't impacting the nexus strangely
k
interesting.. you have your VAT code set which is I believe that’s what Sweden charges and yet your tax type (!) is US Sales Tax and tax code is Avalara’s. Tax code comes from he item, but tax type - do you have your tax type set for Sweden? or is it just for the US?
m
we have tax types for every country, as well as tax codes
k
so your tax RATE is correct, but your tax TYPE is off
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m
but the tax code determination is based on the nexus so it's using the US tax code/tax type here yet returning the swedish VAT
k
sure, on ship to + Nexus. I would dig deeper into tax types just to make sure. funny enough, tax type determines your tax rate, but not here. here your tax rate and name is correct, but not the tax type. Seems ST is using the US type and Avalara is appying VAT
m
yeah here are the tax types
country specific though, I believe determined by the Nexus
k
next is to check with Avalara.. just does not make sense
m
That is often the case with Avalara unfortunately
We're on year... 4 of trying to implement them now
Third set (at least) of customer service folks
k
sorry to hear this. good luck!
m
Thanks again!
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