Tax settings

Tax settings help you estimate contract taxes before publishing a contract, so you can include taxes in budgets and committed costs. This is particularly useful for organizations that use a proxy ERP because you can estimate taxes without integrating with a third-party product. You can also specify whether the payment form taxes are calculated based on gross price or net price and whether those taxes are included in committed costs to InEight Control.

The tax settings at the organization level flow down to the project settings when the tax type's country code matches the country listed in the project details. The organization can define the following:

  • Position

  • Tax description

  • Tax type

  • ERP Code

  • Default percent

  • Country code

  • Calculate payment form tax (net amount or gross amount)

  • Include in committed cost

  • Active status

The position indicates the order that the taxes are shown. To change the position of a tax, drag and drop the line to the new position, and then click Save. The change position is available on all projects.

The tax description is a label that makes the tax recognizable to users. When a tax is referenced, the tax description is shown in the InEight cloud platform, which matches the tax type or ERP code used in APIs. The tax description is shown in the total tax information you see when you click the information icon.

The tax type is used to identify the tax. Tax types must be unique by country code. The tax type values are especially important in a proxy ERP environment to identify and match the taxes in the response. If you use an invoice response from OneDrive to overwrite the taxes with a tax type that does not match the project settings, Contract cannot read, store, or display the tax.

The ERP code is used to send information to the ERP system. If you are an ERP customer, you must match ERP codes. The Tax type code should be sent in purchase order responses. If you use a Proxy ERP, this field is ignored. You can set a country code, so the tax is only applicable to projects in a specific country. You can also indicate whether to calculate the tax on the payment form net amount (after retention is withheld) or the gross amount (before retention is withheld).

How tax is calculated depends on whether Contract is integrated with an ERP system, whether Contract Tax Request (Application integration > Other) is configured, and whether the contract has been published. Prior to publishing or clicking Estimate tax, the line item taxes are always estimated from project settings. The table below represents how taxes are calculated when the purchase order is published or Estimate tax is clicked.

If tax is calculated in ERP system or proxy ERP Used to figure tax
Unpublished contract ERP with Contract: Tax Request configured Contract: Tax Request
Unpublished contract ERP system without Contract: Tax Request configured Settings
Unpublished contract Proxy ERP Settings
Published contract ERP system PO response from ERP
Published contract Proxy ERP Simulated purchase order response (using settings)
Payment form line items Both Estimated proportionally from PO response
Payment form details summary Both User-entered tax when adding invoice. The tax fields and tax types are from the project settings

The Include in committed cost toggle specifies whether to include the tax in the Contract and InEight Control committed value.