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Defining & Calculating Taxes

Overview

In NCR Retail Online, you have the opportunity to apply taxes as you desire to every shipping location you serve. You can specify whether to charge tax on a state-by-state basis, and you can manually specify a single tax rate for each state. If you want NCR Retail Online to automatically calculate taxes based on the shopper's ship-to ZIP code, you can sign-up for the AvaTax Tax Rate Lookup feature. More information is available at http://www.ncrretailonline.com/avatax.

When orders are downloaded into NCR Counterpoint, the taxes can be:

  • Imported: Taxes are downloaded (imported) from NCR Retail Online, or
  • Calculated: Counterpoint calculates the tax based on the customer's tax code, or a combination of the customer's tax code plus the state to which the order will be shipped.

Tax rules and regulations change frequently! Be sure to speak with your accountant or your NCR Counterpoint Retail Partner about setting up taxes in your state.

 

Table of Contents

 

Setting Up Taxes in NCR Counterpoint

When you import orders into NCR Counterpoint for processing, the tax will either be based on the values imported from NCR Retail Online, or NCR Counterpoint will calculate the tax during the import.

Checklist

NCR Counterpoint:

  1. Define tax codes for each state using Setup / System / Tax Codes.
  2. Create a default NCR Retail Online customer using Customers / Customers.
  3. Configure ecommerce controls using Setup / Ecommerce/ Control.
  4. Publish ecommerce information using Ecommerce / Publish.

NCR Retail Online:

  1. Set up taxes in NCR Retail Online using Sales / Tax / Manage Tax Zones and Rates:
  • a) Configure manual tax calculations, OR
  • b) Configure automatic tax calculations

1. Define Tax Codes

NCR Counterpoint: Setup / System / Tax Codes

If you plan to charge taxes on any online sales, you will need to set up at least 51 separate tax codes: a base tax code (e.g., WEB) plus one tax code for each state (e.g., WEBAL, WEBAK, WEBAZ, … WEBTX). This is necessary even for states where you will not charge tax, and even if you are using the Tax Rate Lookup by Avatax. NCR Counterpoint needs a tax code that corresponds to every state that can be selected in your online store.

Enter the appropriate sales tax for each state's tax code (you will probably enter a tax rate of zero for most states and only populate the state or states where you actually charge sales tax).
 

2. Create a Default NCR Retail Online Customer

NCR Counterpoint: Customers / Customers

Select Customers / Customers and create a default customer record (e.g., NRO). The default customer record contains the default values for customers imported from NCR Retail Online (e.g., the tax code, sales rep, customer category, etc.).

3. Configure Ecommerce Controls

NCR Counterpoint: Setup / Ecommerce / Control

Items Tab

On the Items tab of Setup / Ecommerce / Control, specify how ecommerce items are taxed for up to three tax levels:

  • Item ‘is taxable' flag: To charge tax based on the Taxable flag on the Main tab of Inventory / Items
  • Yes (tax all items): To charge tax on all items
  • No (do not tax any items): To not charge tax on any items
  • Item ‘ecommerce tax-1 flag':To charge tax based on the ‘charge tax' flags on the Ecommerce tab of Inventory / Items

Nearly all of our merchants use the Item 'is taxable flag' on the Ecommerce tab of Inventory / Items to determine whether or not each item is taxable.

Customers Tab

On the Customers tab of Setup / Ecommerce / Control :

  1. Enter the default NCR Retail Online customer (e.g., NRO) as specified in Step 2.
  2. In most cases, you should not check the Add ship-to to tax code check mark field.
  3. Optionally specify one or more tax codes to determine which customers will be tax exempt when you publish customer information to NCR Retail Online.

Orders Tab

On the Orders tab of Setup / Ecommerce / Control:

1. Select the base tax code (e.g., WEB) as specified in Step 1.

2. In most cases, you should check Add ship-to to tax code, to add the order's ship-to state (e.g., AL, AK, AZ, … TX) to the base tax code (e.g., WEB) assigned to each new order imported from NCR Retail Online.

3. Select Imported for the tax method to use for orders imported from NCR Retail Online.

When you import orders into Counterpoint for processing, you can use the value as it was imported into Counterpoint, or you can optionally recalculate the tax based on Counterpoint's tax rules. For the Tax method, select Imported to accept the tax that is imported with the order. If you select Calculated, Counterpoint will recalculate the tax during import.

WARNING: When customers place orders in your online store, they are provided with a total amount for the order. If you select Calculated, Counterpoint will recalculate the tax which may cause the total order amount to change after it's downloaded (imported). This means that you may end up charging your customers more or less than they expect to pay for their order.
 

4. Publish Data

Counterpoint: Ecommerce / Publish

Once you have set up tax calculations in NCR Counterpoint, publish the information and allow the Integration Agent approximately 30 minutes to import the file.

Manual Tax Calculations

NCR Retail Online allows you to specify whether to charge tax on a state-by-state basis, and to manually specify tax rate(s) for each state's authorities (state, county, city if applicable).

Basic Tax Options

Setting Up Customer Tax Classes

Customer Tax Classes need to be set up to allow you to manage taxes for customer groups. Retail customers, for example will need to pay tax if purchasing on the web in an area where you are legally able to collect sales tax. Wholesale merchants may be tax exempt. By default, NRO has a single customer tax class already defined called Retail Customers and by default all NRO customer categories are uploaded to that Retail Customers tax class. For example, if you need to create an additional customer tax class for tax exempt customers, follow the steps below to add the exempt tax class.

  1. Select Sales (horizontal top menu) / Tax / Customer Tax Classes.
  2. Click Add New.
  3. Type a Class Name, such as Wholesale Customer or Tax Exempt Customer.
  4. Save your changes.
  5. Repeat these step for any additional customer tax classes you will need for your store.
After the additional tax class has been defined, the customer groups that should be in this tax class need to be configured.
  1. Select Customers (horizontal top menu) / Customer Groups.
  2. Click on the Group name of the customer category (these publish automatically from Counterpoint to NRO) that should be taxed differently than Retail Customers.
  3. In the Tax Class drop menu, select the appropriate tax class.
  4. Save your changes.
  5. Repeat these steps, if needed.

Setting Up Product Tax Classes

Taxable items publish over to NRO and are auto-assigned to a product tax class of Taxable Goods. If the item's taxable flag is unchecked, the IA will not assign the items to any product tax class. If you use Avatax in your store, you will need a custom file to let your non-taxable items automatically assign to a tax class of EXEMPT. There is no charge for this file. Please contact RHA Support to request the file. If you need additional product tax classes to move over from Counterpoint to NRO, please contact Support and we'll provide your options.

Managing Tax Settings for the Store

Some tax settings need to be set up for the store and how they apply to your orders and customers.
  1. Select System (horizontal top menu) / Configuration.
  2. Go to the Sales section, and then click on the Tax tab.
  3. Expand the Tax Classes panel. The Tax Class for Shipping setting determines if you charge tax on shipping. Leave this setting set to the default of, "Shipping (not used by AvaTax)."
  4. Expand the Calculation Settings panel. This panel determines how you apply tax to products.
    Tax Calculation Based On - Location the tax should be based on.
    Catalog Prices - If pirces in your store should reflect the tax on that product or not.
    Shipping Prices - Whether shipping charges will be shown with taxes included. (If applicable)
    Apply Customer Tax - When customer taxes should be applied to an order.
    Apply Discount On Prices - If taxes should be applied to discounts.
    Apply Tax On - If taxes are applied to discounted prices or the original price.
  5. Expand Default Tax Destination Calculation.
    Select the Default Country for your store.
    Default State can be set to display a default tax calculation in the shopping cart. Whatever the customer enters into the cart summary or checkout will override this default. We recommend leaving this as *.
    Default Postal Code can be set to display a default tax calculation in the shopping cart. Whatever the customer enters into cart summary or checkout will override this default. We recommend leaving this as *.
  6. Expand the Shopping Cart Display Settings.
    Display Prices - whether or not to display prices including tax in the cart.
    Display Subtotal - Determines if the subtotal will show pricing with or without tax.
    Include Tax In Grand Total - Whether or not to display tax on the grand total.
    Display Full Tax Summary - Determines if you want a full detail of taxes and how they apply to the order.
    Display Zero Tax Subtotal - whether or not you want to show a zero tax for orders with no tax applied.
  7. Expand the Orders, Invoices, Creditmemos Display Settings. The same options are available in this section as are in the Shopping Cart Display Settings, but they apply to Orders, Invoices, and Credit Memos.
Fixed product taxes will not apply to all merchants. These are fixed tax rates that apply to only certain items.

8. Open the Fixed Product Taxes panel
Enable FPT - Choose whether or not you want FTP to be on.
Display Prices In Product Lists - Whether or not to display FPT prices in product lists.
Display Prices On Product View Page - Choose whether product view pages will reflect the FPT prices.
Display Prices In Sales Modules - Will sales modules include FPT prices?
Display Prices In Emails - Will FPT prices display in emails sent from store?
Apply Discounts To FPT - Are FPT's discountable?
Apply Tax To FPT - Are FPT taxable?
Include FPT In Subtotal - Should the FPT be included in subtotals?
 
Once you everything configured, Save your changes.

NCR Retail Online: Sales / Tax / Manage Tax Zones and Rates

Setting Up Tax Zones and Rates

Note: It is only necessary to set up tax rates and zones for the states/zip codes for which you need to collect sales tax.
 
Tax rates are what determine the percentage amount of the cart total that should be taxed for the states or provinces that should calculate sales tax.
  1. Select Sales(horizontal top menu) /Tax/Manage Tax Zones and Rates.
  2. Click Add New Tax Rate.
  3. Tax Identifier will be a short description of the state or area you are setting the tax rate for.Examples: Alabama or WEB-AL..
  4. Select the Countrythe tax rate is listed in.
  5. Zip/Post is Range has a Yes or No option. If you select 'No' then you will be prompted to add the zip or postal code in theZip/Post Codebox. If you select 'Yes', you will be prompted to include a Range From and Range To zip/Post is Range. This can be helpful to merchants in States where the state has multiple tax rates. IF 'Yes' is selected, you will need to include all rates for all zip code ranges.
  6. Add your Rate Percentage. This is the tax rate for the area specified.
  7. Save your changes.
  8. To assist with the creation of tax rates, see Uploading Your Own Tax Rates

Setting Up Tax Rules

Tax rules are what apply the tax zones and rates to your customer groups. Here is where you can optionally configure whether tax should calculate for the shipping charge, as well.
  1. Select Sales (horizontal top menu) / Tax / Manage Tax Rules.
  2. Click Add New Tax Rule.
  3. In the Name field, provide a meaningful name that will allow you to easily identify it's purpose.
  4. For the Customer Tax Class, most merchants select the Retail Customer customer tax class.
  5. For the Product Tax Class, choose the product tax class applicable to the rule. All taxable items upload to NRO and are assigned a tax class of Taxable Goods. If you have commodities that tax differently, you'll need a custom item mapping file to make the additional product tax classes move over to NRO. Contact RHA Support for more details.
  6. In the Tax Rate field, choose the state(s) to which the rule applies. (Multiple states can be chosen by using the keyboard shortcut of Ctrl + click.)
  7. Assign a Priority to your tax rule, if you have multiple tax rules (authorities) that need to tax in a specific order (state, local, etc)
  8. Sort Order is for the back end only and determines in what order rules are listed. This lets you group your rules together for easy searching.
  9. Save your changes.
  10. Repeat steps 1- 10 of this section for each state or province or territory for which you orders should calculate sales tax.

Automatic Tax Calculations

The standard NCR Retail Online service allows you to specify whether to charge tax on a state-by-state basis, and to manually specify a single tax rate for each state. For more information on manually calculating sales tax, refer to "Manual Tax Calculations.”

The Tax Rate Lookup by AvaTax provides tax rate lookups based on the shipping zip code of the order, so taxes can be calculated accurately. With this feature, you won't have to maintain state tax rates manually! Simply indicate the states for which you charge sales tax, and let Avatax do the rest of the work for you.

With the Tax Rate Lookup by AvaTax feature, NCR Retail Online looks up the exact tax rate for the shopper's shipping ZIP code. You don't have to worry about whether or not you should be collecting (for example) 9.25% for a shopper in Memphis, TN, or 9.75% for a shopper in Nashville, TN.

Tax rate lookups are only available for US ZIP codes. If you activate this feature, taxes will not be calculated for shoppers located outside the United States or for shoppers that enter in an invalid zip code.

Signing Up for the AvaTax Tax Lookup Feature

Web: http://www.avatax.com

To sign up for the Tax Rate Lookup by AvaTax feature, go to http://www.avatax.com and sign-up for this feature. You will be given an Account Number, License Key, and a Company Code. Please contact support with this information to help configure your AvaTax module in NCR Retail Online.
 
NOTE:The monthly fees associated with AvaTax are collected by Avalara, Inc. and are not included with your monthly billing of NCR Retail Online.

Enabling Tax Rates by ZIP Code

NCR Retail Online: System / Configuration / Sales / Tax / AvaTax

After you sign up for the Tax Rate Lookup by AvaTax feature, go to System / Configuration / Sales / Tax / AvaTax and change the Action field to Enable. Fill in the information you received from AvaTax and Save Config.
 
 

Viewing Taxes in NRO Admin Panel

NCR Retail Online: Catalog / Manage Products / Product Detail

When you have drilled down to a specific item, you can view that item's taxable status on the Prices tab. This field is uploaded from Counterpoint.

Downloading Orders to NCR Counterpoint

When you download NCR Retail Online orders into NCR Counterpoint, the sales tax will either be based on the values downloaded from NCR Retail Online, or else NCR Counterpoint will calculate the sales tax during the import.

If you selected Calculated for the tax method on the Orders tab of Setup / Ecommerce / Control, NCR Counterpoint will calculate the sales tax during the import based on each customer's tax code.

NOTE: Regardless of the tax method you select, back orders, price adjustments, etc. may cause NCR Counterpoint to recalculate the sales tax.

Because sales tax is based on the tax rates defined in NCR Retail Online and not the store's tax code or the customer's tax code, taxes will display as tax overrides when you process orders.
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