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Add vendor charged sales tax to a vendor invoice in Microsoft Dynamics 365 for Finance and Operations

Calculate and verify use tax if a vendor hasn’t charged any tax.

Steps

  1. On a vendor invoice, go to Financials > Tax and then click Sales Tax.
  2. On the Sales Tax Transactions page, on the Adjustment tab:
    1. Enter the tax amount the vendor charged in the Actual Sales Tax Amount field and then click Apply Actual Amounts.
    2. If the amounts that display in the Total Calculated Sales Tax Amount field (the total tax that AvaTax calculated) and the Total Actual Sales Tax Amount field (the sales tax amount the vendor paid) look correct, select OK.
  3. When you post the transaction:
    • If Auto Accrue Undercharged Tax is set to No in your consumer use tax settings, messages display showing the difference between the tax the vendor charged and the tax AvaTax calculated. If the vendor charged less than the amount AvaTax calculated, and the amount is not within the threshold amount indicated in your settings, choose whether to accrue that amount.
      • If you don't want to accrue consumer use tax for the invoice, select No.
      • If you want to accrue consumer use tax for the invoice, select Yes. The consumer use tax calculates for the transaction and posts to AvaTax and the associated general ledger accounts.
    • If Auto Accrue Undercharged Tax is set to Yes, the amount outside the threshold indicated in your settings automatically accrues and posts to your general ledger.