Set Up Code Values for Withholding Taxes and Tax Reclaims

Before you can process tax withholding in Eagle Accounting, you must correctly set up entities and securities. During setup, you must make several elections at the account level and at the security master level that relate to tax processing. You must set up certain types of code values prior to setting up accounts and securities.

Add Entity Tax Type Codes

In the Codes workspace, you can define a set of values for the ENTITY TAX TYPE code category. An entity tax type indicates the tax status of an entity. Entity Tax Types is one of two identifiers used to group accounts for tax accounting purposes.

Add Entity Tax Qualifier Codes

In the Codes workspace, you can define a set of values for the entity tax qualifiers using the ETAX QUALIFIER code category. Entity Tax Qualifiers are the second of two identifiers used to group accounts for tax accounting purposes — they further define the Entity Tax Type. For example, possible values include Taxable, Non-Taxable.

Add Issue Tax Type Codes

In the Codes workspace, you can define a set of values for the ISSUE TAX TYPE code category. The Issue Tax Type value indicates the tax status of a security, or types of securities. In contrast, the Entity Tax Type indicates the tax status of an entity. For example, EQ.

Add Primary Exchange Codes

In the Codes workspace you can define a set of values for the Primary Exchange using the IEXCHANGE CODE code category, if you did not do so already.

The system uses the Primary Exchange when you set up the tax rate in the Create Global Tax Rates panel, and also uses it in conjunction with the Issue Tax Type to further differentiate securities. In addition, you identify the exchange name and exchange code for each security during setup. For example, XBOS, BOSTON STOCK EXCHANGE.

The system uses the Primary Exchange field in conjunction with the Issue Tax Type in the Global Tax table used for global tax rates. Eagle Accounting cannot apply a tax rate solely by obtaining a match on Primary Exchange.