Configure Transaction Tax Rules for Items

Create a transaction tax item for a country.

Create transaction tax item groups.

Create tax applicability.

Security: Set Up: Tax
domain in the Common Financial Management functional area.

You can override all other tax codes and tax applicability by defining tax code and tax applicability rules. Workday uses these rules to calculate taxes for specific items.

Access the

Create Transaction Tax Rule for Items

task.

In the

Tax Item Rule Type

prompt, select:

Revenue
for sales items.

Spend
for purchase items and expense items.

As you complete the task, consider:

Option	Description
Spend Category Revenue Category	Workday populates the revenue or spend item for selection depending on whether you specify Revenue or Spend in the Tax Item Rule Type prompt. Select a category to apply the rule line to all items in that category. The Revenue Category or Spend Category is unavailable for selection if you specify the Tax Item Group .
Tax Item Group	Select a tax item group to apply the rule line to all items in that item group. The Tax Item Group is unavailable for selection if you specify the Revenue Category , Spend Category , or Item .
Item	Select an item to apply the rule line to only that item. The Item is unavailable for selection if you specify the Tax Item Group .
Tax Applicability Override	Select the tax applicability to use on transaction lines for this rule. This value overrides other tax applicabilities that Workday automatically populates on revenue or spend transactions.
Tax Code Override	Select the tax code to use on transaction lines for this rule. This value overrides the tax code specified in a tax rule for a country that references this rule.
Tax Point Date Type Override	Select a tax point date type to override the default on spend transaction lines for this rule. Transaction Date is invalid on spend transaction lines. When you select Transaction Date , Workday instead populates the Invoice/Adjustment Date or, when VAT on payment is enabled for the company, the Payment Date . When you select Goods/Services Delivery Date , Workday doesn't populate this date on supplier invoices created using web services. Since a tax point date is required for Goods/Services Delivery Date , and invoices created using web services can be approved automatically, Workday doesn't populate the Goods/Services Delivery Date to prevent the creation of bad data.
Tax Recoverability Override	Select the tax recoverability to use on transaction lines for Tax Code Override tax rates. This rule overrides other tax recoverabilities that Workday automatically populates on spend transactions.
Tax Option Override	Select the tax option to use on specific tax rates for transaction lines. This rule overrides other tax options that Workday automatically populates on spend transactions.
Worktags Tax Rule	Displays for spend tax item rules only. When you select a transaction tax rule for worktags, Workday evaluates the worktags within the transaction. If the worktags match the worktag-level tax rule, Workday populates tax details from this rule.

If using both procurement and expenses, account for purchase items and expense items. You design a country tax rule that focuses only on the tax status of the company transaction. That rule might match on both supplier invoices and expense transactions and use the associated item tax rule.

You can associate your tax rules for items with tax rules for countries.

Configure Transaction Tax Rules for Countries

Configure Transaction Tax Rules for Worktags