The tax forms facility exists to help file sales tax forms. It’s primarily modelled after the 1099 US tax reporting forms functionality, which means that it’s cash based. The fact that it’s cash based means that invoices will be included in the tax report as soon as cash for the invoice is received. Accrual based reporting means that the tax is reported based on the invoice date instead of the payment date.
This system can only be used in some EU countries and by some companies at that: the country needs to allow cash based reporting and the company needs to have filed for cash based reporting as well.
Before using this functionality be sure to check with an accountant or the tax authorities if cash based reporting is appropriate.
Tax forms are meant to support tax reporting requirements in the countries where the company has tax reporting obligations. This means that tax forms are country specific: each country for which reporting obligations exist needs to have its own form associated.
In order to be able to collect taxes in a tax form companies need to be linked to it. Section 34.2.2 on page 34.2.2 describes how to do this.
When associations have been set up between companies and tax forms, the “Tax form” check mark can be used in invoices to include (or exclude) invoice lines from the tax form. See Section 38.2.1 on page 38.2.1 for entry of invoices.
Note that there’s a module available for 1.3 which implements accrual based tax reporting by the name of EU VAT reporting. This module replaces the default tax reporting functionality meaning one can only have accrual based or cash based reports in a single company at this time, but not both.
Tax forms can be created (or edited) using the menu options available under the “Taxforms” main menu item.
Tax forms have three fields.
Country to which the tax form applies
Name of the tax form to be displayed in drop down lists