Tax and Payment Terms Configuration for Suppliers

Tax and Payment Terms Configuration for Suppliers

Overview

This article outlines the steps to set up supplier tax details and payment terms in iVendNext.





1. Introduction to Tax and Payment Terms

In iVendNext, tax details and payment terms can be configured at the supplier level, ensuring that all transactions with a supplier adhere to the correct tax rules and payment conditions. This not only simplifies the procurement process but also ensures compliance with local tax regulations and improves cash flow management.



2. Prerequisites for Configuring Tax and Payment Terms

Before configuring tax and payment terms, ensure that the following prerequisites are met:


  • Supplier Creation: The supplier must already be created in iVendNext. If not, refer to the Understanding Suppliers in iVendNext guide to create one.

  • Tax Rules and Templates: Ensure that the necessary tax rules and templates are set up in iVendNext. This includes Tax Categories, Tax Withholding Categories, and Purchase Taxes and Charges Templates.

  • Payment Terms Templates: If you plan to use default payment terms, ensure that the relevant Payment Terms Templates are created.



3. How to Configure Tax Details for Suppliers

3.1 Accessing the Supplier Master

  1. Navigate to Supplier Master: Go to Home > Buying > Supplier to access the Supplier List View.


  1. Select a Supplier: Choose the supplier for whom you want to configure tax details.


3.2 Setting Up Tax Details

  1. Tax Identification Number (Tax ID): Enter the supplier’s tax identification number in the Tax ID field.


  1. Tax Category: Select the appropriate Tax Category from the dropdown menu. This category is linked to the Tax Rule and determines the tax rates applied to purchases from this supplier.


  1. Tax Withholding Category (for India): If operating in India, select the appropriate Tax Withholding Category (TDS category) for the supplier. This will be fetched into the Purchase Invoice.


  1. GST Category (for India): For Indian businesses, select the appropriate GST Category for the supplier.


  1. Save: Click "Save" to apply the tax details.




4. How to Configure Payment Terms for Suppliers

4.1 Setting Default Payment Terms

  1. Navigate to Supplier Master: Go to Home > Buying > Supplier to access the Supplier List View.


  1. Select a Supplier: Choose the supplier for whom you want to configure payment terms.


  1. Default Payment Terms Template: In the Payment Terms section, select the appropriate Payment Terms Template from the dropdown menu. This template will be automatically applied to all future transactions with the supplier.


  1. Save: Click "Save" to apply the payment terms.


4.2 Blocking Suppliers

If you need to temporarily block a supplier from creating invoices or receiving payments, you can set a Hold Type and Release Date:


  1. Hold Type: Choose from the following options:


  • Invoices: Block the supplier from creating Purchase Invoices or Purchase Orders.

  • Payments: Block the supplier from receiving Payment Entries.

  • All: Block both invoices and payments.


  1. Release Date: Set a date when the hold will be automatically lifted. If no date is set, the supplier will be blocked indefinitely.


  1. Save: Click "Save" to apply the hold settings.



5. Key Features of Tax and Payment Terms Configuration

5.1 Tax Category and Tax Rules

  • Tax Category: The tax category determines the tax rates applied to purchases from the supplier. It is linked to the Tax Rule, which defines how taxes are calculated.

  • Tax Withholding Category (India): For Indian businesses, the tax withholding category (TDS) ensures that the correct tax deductions are applied to supplier payments.


5.2 Default Payment Terms

  • Payment Terms Templates: These templates define the payment conditions (e.g., net 30 days, 50% advance) that apply to transactions with the supplier.

  • Auto-Population: Once a payment terms template is set at the supplier level, it will auto-populate in all future transactions, reducing manual data entry.


5.3 Supplier Blocking

  • Temporary Holds: You can temporarily block suppliers from creating invoices or receiving payments, which is useful for resolving disputes or managing cash flow.

  • Automatic Release: Set a release date to automatically lift the block, ensuring that suppliers are not blocked indefinitely.



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