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Alternative GL Accounts and Tax Rates

Last updated 03/10/2017

Customers may have special requirements in terms of the Tax Rates they receive, or the General Ledger Accounts to which their sales are recorded. This article explains the appropriate way to use these functions.

Alternative General Ledger Accounts


Alternative General Ledger Accounts direct sales to different accounts in your accounting software. When applied to a customer in the CRM, the Alternative General Ledger Account automatically appears in the Sales Order when that customer is chosen.

This is a great feature if you always record sales to a specific customer to a specific account, and need to automate this process.

This article assumes that you have already set up your accounting software, and that you have created Alternative GL Accounts. If not, please refer to Setting up Alternative General Ledger Account.

To Apply an Alternative GL Account to a customer:

    1. In the CRM module, click View on the customer you would like to update.
    2. In the accounts section, choose the correct account from the Alternative GL Account dropdown.
    3. Click Save.
In a new Sales Order, the Alternative GL Account is applied to the whole order when the customer is selected.

Alternative Tax Rates


Alternative Tax Rates alter the Tax Rate applied to your Sales. These can be applied to customers so that the correct Tax Rate is applied automatically in a Sales Order.

There are several reasons a customer may be assigned an Alternative Tax Rate:

  • They are not charged GST or VAT (e.g. they are a charity).
  • You do not charge Tax by default and would like to include Tax for certain customers (e.g. US State based Tax rates).

Alternative tax rates must be set up correctly before they can be applied to customers. For more information on how to do this please see Setting up an Alternative Tax Rates.

To apply an Alternative Tax Rate to a customer:

    1. In the CRM module, click View on the customer you'd like to update.
    2. In the accounts section, choose the correct account from the Tax Status drop-down.
    3. Click Save.
In a new Sales Order, the Alternative Tax Rate is applied to the whole order when the customer is selected.

FAQs

If I apply an Alternative GL Account to a customer, but also apply a GL Account to a product - which GL Account ultimately takes precedence?

Great question. The priority order, with 1 being the highest priority, is as follows:

  1. Line Item
  2. Order
  3. Branch
  4. Default Accounts as per the QBO/Xero settings
Do Customer-assigned Alternative GL Accounts apply when using the POS?

No they don't - for a very specific reason. When you close a register, batches are created which consolidate all transactions - this means that individual POS sales don't get posted to your accounting software at all.

Do Customer-assigned Alternative Tax Rates apply when using the POS?

No, however it is possible to change the Tax Rate in the POS. Please refer to Using Multiple Tax Rates in the POS.