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How to Setup Purchase or Sales Tax for a Product in Sage X3


Sage X3 allows users to define tax information for use in Purchasing or Sales. This allows the calculation of sales tax on purchase orders and purchase invoices or sales orders and sales invoices.

The steps below will walk through the setup and process of sales tax in Sage X3.


  • Define a general ledger account for the tax postings
  • Setup a Tax accounting code
  • Define product tax levels
  • Define BP tax rules (Customer / Supplier)
  • Create the tax rates


  1. Setup the tax determination relationship
    • Assign the product tax level to a product
    • Assign the tax rule to the supplier or customer

  2. Setup the Sales Tax GL Account
    • Common Data > G/L accounting tables > General > Accounts
    • Create a Sales Tax Payable and/or Sales Tax Expense account
Setup GL Acct

  1. Setup the Accounting code for Tax
    • Setup > Financials > Accounting interface > Accounting Codes
Set up Accounting code

  1. Setup the Product Tax Levels
    • Common data > Common tables > Taxes

Set up product tax levels


  1. Define the BP (Supplier / Customer) tax rules
    • Common data > Common tables > Taxes > BP Tax Rule

Define BP


  1. Define the Product Tax Level
    • Common Data > Products > Products 

Define Product Tax


  1. Assign the tax to the BP (Supplier / Customer)
    • Common data > BPs > Supplier or Customer

Assign BP


  1. Setup the Tax Rate
    • Common data > Common tables > Taxes
    • Select the Accounting code
    • Enter the tax rate with a starting date 

Tax Rate


  1. Setup the Tax Determination
    • Common data > Common tables > Taxes
    • Select the BP Tax Rule and Product Tax Level
    • Assign the tax code and set as Active

Tax Determination


  1. Create a Purchase invoice and post.

Purchase Invoice
Purchase Invoice 2
Purchase Invoice 3


  1. Review the GL Journal Entry
Tagged With: Sales Tax, Sage X3
LeeAnn Segan

Written by LeeAnn Segan

LeeAnn Segan is an ERP Support Specialist with RKL eSolutions LLP. She supports Sage 500 ERP and Sage X3. LeeAnn specializes in the financial and distribution modules. Her background includes managing distribution and warehousing for ecommerce based companies. When not working, LeeAnn enjoys working out, volunteering with groups that support special needs, and spending time at the beach with family and friends.

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