UPS Online and Tax issues

[Gourockian]

Hi,

Here's another question for anyone out there. We intend operating from Florida where the State Dept. of Revenue requires us to collect Sales Tax on all in-state purchases (I guess most states do). However, it is not just a simple case of adding 6% as they also want us to collect a Sales surtax which is set by each of the 68 counties and varies from 0% to 1.5%.

The first step we took was to go to Advanced/Locations and set up the counties as Sub-Districts of Florida which meant giving them Abbreviations like FL for the first one, then FL1, FL2, FL3.....etc. Using FL1 for the first one meant that Florida did not appear as a state. So far so good.

At a later stage, we set up the tax rates of 6.0%, 6.25%, 6.5%, 7.0% and 7.5% and assigned the counties to their appropriate rate. Again no problem.

However, when I check the box for UPS OnLine Rates and Service Selection and click Apply, I get an error message which states "....You currently have states defined for the United States which are not recognized by UPS Online tools. You should remove these states from the US for UPS Online tools Rates & Service to function properly. If you would like to support shipping to these regions, you should specify them as countries...." It then gives a long list of all the non-existent 'states' in the format, Florida : Baker etc.

Well, obviously we have to ship to these 'regions' but how do I specify them as countries? I've just tried it, while compiling this, in Advanced/Locations and entered a couple of FL counties as countries, using the abbreviation US, but of course when I clicked Apply, it would not accept a duplicate code. I then deleted these entries and then found to my horror (now I've got yet another problem) that, although United States was still shown near the top of the list of countries, all the states and counties are now deleted from the RHS. Canada and the provinces were fine but nothing for the US.

I don't know if this will help. I went to the website order page and copied the source code for all the countries, states and counties into my HTML editor, but how do I go about restoring everything without having to type in every state and FL county again?

Getting back to the original issue, is there any way to set up Sub-Districts which will also be accepted by UPS Online? I'm sure others have come up against this but I don't see any threads relating to it.

Please let me know if there is any solution to both problems.

Thanks,

Alistair

[Gourockian]

Well, judging by the fact that I've not had any response so far, it looks like there's no ready solution to the problem of having tax zones and also using UPS Online tools. I've found other threads referring to setting up tax rates but none of them included using also UPS Online.

I guess for the moment the only thing I can do is to use, perhaps a 7% flat tax rate for Florida, to allow UPS Online Tools to work as normal. I see other well-established online companies are doing this ...some in fact are only charging the base rate of 6%.

Suggestion to Actinic developers: as this is likely to become more and more of an issue for US online retailers, due to state Departments of Revenue trying to squeeze every penny of tax, would it not be possible to set up the Sub-Districts so that they are only recognized for tax and not for UPS Online shipping?

Alternatively, we could perhaps have an additional dedicated field for Counties, which would have an alphanumerical abbreviation code, such as FL1, FL2 etc. Ideally, this would only identify it for tax purposes and the data could be entered manually, although it would be great if it could be preloaded for each state. This information is available at http://www.itl.nist.gov/fipspubs/co-codes/states.htm

I hope someone takes this on board or comes up with another solution.

Alistair

[Nadeem]

Hi Alistair,

I am posting your information over to the development team and seeing if we can do anything regarding this.

Kind Regards

[Gourockian]

Hi Nadeem,

Thanks for doing that. I'm sure they'll be able to come up with something.

Regards,

Alistair

[Nadeem]

Hi Alistair,

Just been checking some things with development regarding this issue, and they have mentioned the following:

> The first step we took was to go to Advanced/Locations and set up the
> counties as Sub-Districts of Florida which meant giving them
> Abbreviations like FL for the first one, then FL1, FL2, FL3.....etc.
> Using FL1 for the first one meant that Florida did not appear as a
> state.
I cannot create a sub district of FL1. The Sub District code cannot be
greater than 1 character.
I set up sub-districts of FL as FL:1 and FL:2, these worked with the UPS
address validator as the code does already remove the colon and
sub-district.

Please could you check this on your version of Actinic.

Kind Regards

[Gourockian]

Hi Nadeem,

I'm not sure why development say thay can't create a sub-district such as FL1, etc. I was able to create FL1 thru 68 so that I could set up the tax rates for each county. It was only when UPS Online Rates were selected that the problem arose.

But here's another thing. I can't get the Sub-District Code field to accept a colon. It will only allow alpha-numerical characters, up to a maximum of 5, so it's impossible for me to try out their suggestion at the moment. Do you know of any way to allow this field to accept additional characters?

Regards,

Alistair

[Gourockian]

Nadeem,

I've just re-read your previous answer and perhaps I did not quite read it correctly the first time. Are the developers suggesting that the Sub-Districts (counties) be actually named as FL:1, FL:2 etc? If so, that raises two problems as far as I can see.

#1 What code is then used? They can't all be FL and the field can't be left blank.

#2 How would the customer be able to identify the appropriate county from the drop-down menu in the State/County field?

Incidentally, I'm using A/Business v7.0.3.1.0.0 FBIA

Regards,

Alistair

[Nadeem]

Hi Alistair,

When they create sub-districts in the locations dialog, they can give the
sub-district a name eg 'Orange County' and 'OC'.

The buyer sees 'California:Orange County' and the UPS interface strips ':OC' from 'CA:OC' before sending it to UPS.

'California:Orange County' is converted to 'California' when used in an
address.

Kind Regards

[Nadeem]

Hi Alistair,

I have just recieved something from the developers on a walk through

In Advanced | Locations, select United States on the left and Florida on
the right.
Click the 'Create Sub-District...' button.
Specify a name such as Miami and a Sub District code such as 1.
Click OK.
Note that the State Florida now reads as 'Florida : Miami' with code
'FL:1'.

The buyer will see 'Florida : Miami' in the drop down list, not 'FL:1'.
Tax processing will distinguish between 'FL:1', 'FL:2' etc. but shipping
will just use 'FL' to determine that it's Florida.

Kind Regards

[Gourockian]

Hi Nadeem,

Thanks for persevering with this. It looks like this is going to do the trick. It's pretty simple really and I should have tried to only use numbers in the Code box.

What I don't understand is that when I first worked at this, I could enter FL1, FL2, etc. into the code field, but now it won't let me. I originally was working with a slightly older version but I've since updated to the current one, so maybe that's the explanation.

Anyway, thanks again for your help with this. (Might be worth putting this info on the forum as some sort of informational item, so that it becomes more visible to other US users).

Regards,

Alistair

[BPJSURF]

The issue of tax and sub location does come up in states like NJ,NY FL, OH and California. The issue is fairly well documented. The simple solution (the one that is accepted by most major retailers is to collect the maximum required tax for a state I.e. NJ 6%. Make sure you pay in what ever you collect and there should be no tax liability. essentially collect the max and give all the money to the state tax board. I spoke with tax officials in the states I mentioned above and they all concur that this is acceptable and they welcome the extra monies. Now this is not the most elegant solution but it is by far the easist way to handle the issue from an accounting perspective and it simplier to check out in the shopping cart.

The solution your trying to implement of adding sub locations is not recomended. In your case you will add 68 additional locations to the "state" checkout dropdown list. Sit back and watch your shopping cart abondonment soar!. People will be confused by this solution. Sure your accountant will feel comfortable with the extra 68 tax zones but you will not like your customers reaction to the extra long dropdown box. This will effect all users as well, not just florida residents. I have been here and done that. Every single customer I have implemented the sub location for to appease their accountant has not too much later begged me to undo it so they could continue to make a profit.

Thats my expereince.

Brian

[Gourockian]

Hi Brian,

Thanks for your input here. It's good to hear that we are not the only ones dealing with this. However, I've also spoken to Florida Dept. of Revenue staff and they were quite emphatic that the correct rate of Sales Surtax had to be collected. In fact, the official Sales and Use Tax Guide also makes it clear that the surtax is to be "collected at the county rate where delivery is made", except where no surtax has been levied or where the customer has a tax exemption.

We initially gave up on trying to get UPS shipping and Sales tax working harmoniously and decided on using a flat 7% rate. But after finding out the hard way how easy it was to set it up, we've now got them both in sync with all 68 counties listed, so I think we are going to leave it like that for now.

I tend to disagree with your theory about buyers being put off by having to scroll down to find their state/county. It actually only takes about half a second, using the scrollbar and they can see almost immediately that the correct rate has been applied. If they are prepared to spend a few minutes browsing the website and deciding what they want to buy, I seriously doubt if the extra time on checkout will put them off. I think some would be less happy if we used the maximum rate of 7.5%, which only applies to 4 counties, particularly if they normally only pay 6%. Some of our items will retail for over $700 so that would amount to a fair bit of extra tax.

Incidentally, when checking around to see how other online stores tackled this, I noticed that some major ones were only charging the state rate of 6%, even though their stores were located in a 7% zone. I mentioned this to the tax officer I spoke to (without giving names, of course) and he told me that they were aware of some companies doing this. He said that it was only a matter of time before their auditors caught up with them and they would be hit with hefty penalties. We would rather keep on the right side of the law than take any chances, especially being a new company.

We'll see how it goes and who knows, we may have to eventually apply a flat rate. Tell you what, if we do, I'll let you know.

Thanks again,

Alistair

[Gourockian]

Hi,

I'm having yet another issue regarding Sub-Districts, which has only come to light when trying to process offline orders. I have already got the Florida counties set up as Sub-Districts and everything, including UPS Online Tools, works fine when ordering online,. Here's what I'm trying to do with an offline order.

I entered a Florida address, complete with county, e.g. Florida : Pasco, then the order details, but when I click on 'Next', I get a prompt saying "please select shipping zone".

I checked my shipping zones and nothing appears for Florida at all, but they are OK in the Tax zones. It looks like Actinic does not recognise sub-districts as shipping zones but yet they are required for tax purposes. Is this a flaw in the program or am I missing something (yet again)?

I also went to Locations and entered Florida as a state, which then allowed me to place it in the shipping zone but when I try to upload, it's looking for the tax info for Florida. However, I can't enter that as it would conflict with the rates for all the sub-districts.

Has anyone else had this problem or can anyone suggest a solution? Thanks, in advance, for any help out there.

Regards,

Alistair

[Nadeem]

Hi Alistair,

Just to double check, have you setup all the Florida provinces individually within the shipping zone. I'm afraid you would need to set them as states within the software.

Kind Regards

[Gourockian]

Hi Nadeem,

I set up the counties as Sub-districts of Florida, per your reply to this thread on June 14th, to enable me to use the correct tax rates and also allow UPS Online Tools to work properly.

By doing this, Florida itself is no longer available in Locations and therefore Shipping Zone, as a state. The problem seems to be that Actinic does not recognize the Sub-Districts, to allow them to appear in the shipping zones. It seems a bit ironic that the UPS software is able to disregard the colon and Sub-district but Actinic is not.

I can't create the counties as states as you suggest, otherwise UPS will not recognize them. I believe we need some sort of fix here which will allow the colon and subdistrict to be disregarded for shipping purposes. This would allow the state to be placed into the shipping zone as normal.

Is this something that can be looked into by the developers?


Regards,


Alistair