Example of rounding of payments to sales tax authorities

The sales tax ledger account of a company that uses EUR as its company currency shows a (credit) balance of EUR -98.765.43. The company has collected more sales taxes than it paid out, and it owes money to the tax authority.

The company wants to use a rounding method that rounds off the balance to the nearest 1.00 EUR. The employee responsible for sales tax accounting must do the following:

Click General ledger> Setup> Sales tax authorities .
On the Generaltab, select the value Normalin the Rounding formfield.
In the Round-offfield, enter 1.00.
When it is time to pay the sales taxes to the tax authority, click General ledger> Periodic> Sales tax payment> Sales tax payment , and run the periodic job.
In the tax report, the tax amount EUR 98.765.43 is rounded to EUR 98.765.

The table below shows how two amounts are rounded with each of the rounding methods that are available in the Sales tax authoritiesform:

Rounding form	Round-off= 0.01	Round-off= 0.10	Round-off= 1.00	Round-off= 100.00
Normal	98.765.43	98.765.40	98.765.00	98.800.00
Downward	98.765.43	98.765.40	98.765.00	98.700.00
Rounding-up	98.765.43	98.765.50	98.766.00	98.800.00
Own advantage (If credit balance)	98.765.43	98.765.40	98.765.00	98.700.00
Own advantage (If debit balance)	98.765.43	98.765.50	98.766.00	98.800.00

Note
If you select Own advantageand set up a Round-offof 0.10, 10.16 is rounded to 10.10, and -10.16 is rounded to -10.20. The rounding is always to the advantage of the company.

See Also