Goods and Services (GST) in Dynamics AX

What is GST?
Goods and Services Tax (GST) is a tax charged on the supply of goods and services made in Singapore and on the importation of goods into Singapore. Here is a quick overview of GST and how to handle the GST by using Dynamics AX (formerly named Axapta).

Types of taxes
There are two types of taxes one is input tax, another is output tax.
Input tax is the provision from buying goods or services from GST-registered business or import goods into Singapore whereas output tax is that tax collected from customer.
After we have known the basic terms of GST and we could start to setting up the sales tax in Dynamics AX. There are a few things we need to configure such as sales tax calculation, settlement periods, sales tax authorities, item sales tax groups, ledger posting groups.

1. Sales Tax Calculation
The current tax rate in Singapore is 7%. Remember to define the rate in Sales tax code and associate to sales tax group and item sales tax groups. Of course you may need to maintain the rate according to the latest rate manually.

2. Settlement Periods
The GST legislation allows for two alternative tax periods, one is for three month another one for one month. If a non-profit has an annual turnover of $20 million or more they must elect to have a one-month tax period. Those below $20 million can elect either monthly or quarterly.

3. Sales Tax Authority
All the tax payment need to report to Inland Revenue Authority of Singapore (IRAS)

4. Ledger Posting Groups
You may set up the posting profile for GST transaction such as ledger account for Account Payable and Settlement Account.


a. Account Payable
- Outgoing sales tax that we collect on behalf of tax authority when we sell the goods to customers.
- For example, we sold item to customer with the subtotal $95, tax amount is $5. The ledger posting transaction as below:

- Ledger account DR ($) CR($)
=================================================
Customer account (Account Receivable) 100 (DR)
Account Payable 5 (CR)
Sales Revenue 95 (CR)

b. Settlement Account
- At the end of the sales tax settlement period for the sales tax authority, you can run the Sales tax payment periodic job. During this job, the amount that the company owes the sales tax authority for the period is transferred from this account to the sales tax authority's vendor account.

For simple ways to setting up Sales Tax or GST in Dynamics AX please refer to http://novprincess.blogspot.com/2007/12/how-to-handle-gst-in-dynamics-ax.html

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Frequently asked questions when implementing GST in Dynamics AX