Currency and Tax setup in free Purchase Order Software

We’ve had a few support tickets from folks in the United Kingdom, asking how to change the default currency in SpendMap from dollars ($) to pounds sterling (£).

The question usually comes alongside another question about how to set up Value Added Tax (VAT) as the default sales tax rate in the system.

So this blog post outlines the options for changing the default currency and taxes in the free version of SpendMap.  I’ll use “pounds” and “VAT” as the examples, but SpendMap supports other currencies and taxes too, which you can set up in the Tax and Exchange Rates Master File.

Setup Wizard

First things first, I guess I should mention that you will be prompted to select your currency and default taxes during the Setup Wizard, which will run automatically when you log into your Live (Production) copy of SpendMap for the first time.

If for some reason you want to change the currency or taxes in the Evaluation copy of SpendMap (the sample data in the Evaluation copy uses dollars ($) and a generic tax code of “TAX 1”), or if you just missed that part of the Setup Wizard the first time you ran your Live copy, keep reading to learn how to change the default currency and taxes after-the-fact…

Defaults Are Just Defaults

Before I get started, please note that the system-wide default currency and taxes that I am referring to here are just that, defaults.  Regardless of what the defaults are set to, you can use a different currency and taxes for each Purchase Order.

For example, you might do business with suppliers in many different countries, in which case you can assign different currencies to those suppliers in the [Settings] Folder of the Supplier Master File.

Similarly, the taxes might be different for each Purchase Order (or even each line item on each PO), based on the type of item that you’re buying, where it is being shipped to, etc.

For complete details, please see the subsections called “About currency conversion” and “Defaulting tax codes on transactions” in the Online Help for the Tax and Exchange Rates Master File.

Setting the Default Currency

So again, if you missed the part about currency setup during the Setup Wizard that runs when you launch the Live copy of SpendMap for the first time, here’s how you can do it after-the-fact…

First, go to the Tax and Exchange Rate Master File, using this menu option…
– PURCHASING > Master Files > Tax and Exchange Rates > Add/Modify/Delete

So, using British pounds (GBP) for this example, just create a new code as “GBP” and enter the “£” symbol.  Also, since this is your local/landed currency that purchases in any other currencies will be converted to for reporting purposes, make sure to enter “1” for the conversion rate…

Currency Setup in free Purchase Order Software

Then, specify the Exchange Rate code (GBP in this example) in the Landed Currency Code field in here…
– PURCHASING > Setup system > User defined terminology and settings > User defined field defaults

That’s it.  From that point on, all new Purchase Orders will be in GBP (£), unless you select a supplier that uses a different currency, per the subsection “About currency conversion” in the Online Help for the Tax and Exchange Rates Master File.

Setting the Default Sales Taxes

Again, you will be prompted to select your default taxes during the Setup Wizard, but here’s how you can do it manually if you missed that…

First, go into the Tax and Exchange Rate Master File and create a new tax code.  Again, using Value Added Tax as this example, I would use a code like “VAT”, but you can call it anything you want.  And don’t forget to fill in the tax rate (percentage) in the Rate Field…

Sales Tax Setup in free Purchase Order Software

Then, specify the Tax code (VAT in this example) in the Local/Default Tax Code field in here…
– PURCHASING > Setup system > Tax settings

And from that point on, all new Purchase Orders will include VAT tax, again, unless you select an item, ship-to location, or other variable that overrides the default taxes.  For example, some goods and services are subject to VAT at a reduced rate of 5% (such as domestic fuel) or 0% (such as most food and children’s clothing), in which case you might set up additional tax codes (with different tax rates), and assign those taxes to certain items in the Item Master File.

Again, for details on the various areas from which sales tax rates can default when you create new POs in the system, please see the subsection “Defaulting tax codes on transactions” in the Online Help for the Tax and Exchange Rates Master File.

Two User-Definable Tax Fields

As you work in SpendMap, you will notice that there are two separate tax fields (called “Tax 1” and “Tax 2” by default).  You can use one tax field or both if you pay more than one tax on your orders.  For example, most companies in the USA would use a single field as “State Tax” while many Canadian companies might title the fields “Provincial Tax” and “Federal Tax”.  Other common examples include “County Tax”, “City Tax”, etc.

So, aside from being able to set up as many tax codes as you need (with associated rates/percentages), you can also rename the titles of these fields on screens and reports throughout SpendMap, using this menu option…
– PURCHASING > Setup system > User defined terminology and settings > User defined field names and terminology

tax totals

 

 

5 comments

  1. Could you kindly let me know whether the software supports financial transactions happening in INR (Indian Rupee). If yes, kindly guide me on having it set up. We are a domestic firm located in Bangalore, India and all our transactions are in INR. Kindly help!

    1. Hello again Manjunath. Yes, you can use INR as the base/landed currency in your system. Just follow the steps in this blog post to set it up. Per the section “Setup Wizard”, you will be prompted to select a currency when you run the Setup Wizard for your Live System, otherwise you can follow the steps under the section “Setting the Default Currency”. If you still have questions, please reply to the e-mails on support ticket C74733, already in progress. If you’re not getting those e-mails, please check your Junk/SPAM e-mail folder. Thank you.

    1. Hello Rajatha,

      The following blog post explains how to edit the footer (short terms text) at the bottom-left corner of the PO form in the Free Version of SpendMap…
      https://free-procurement.com/2015/06/09/terms-and-conditions-on-po-form-ts-and-cs/

      Sorry, in the Free Version you cannot remove our logo and link to our website that appear below the Short Terms Text.

      Thanks for choosing SpendMap and have a great day!

      The Free-Procurement Team
      Totally free software that automates Purchase Orders and a whole lot more.
      Powered by SpendMap

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