How to Configure Sales Tax on your Rentvine Account

Do you need to collect sales tax for certain goods and service fees? This article will show you how to set up your Rentvine account to automatically collect sales tax and then have the sales tax paid out to the management company.

By following these steps, you can ensure that sales tax charges on taxable goods and services are automatically created helping you to accurately track and manage your tax obligations.

In general, it is best practice for Property Managers to charge and collect sales tax on taxable goods and services that are applicable, and then paid out to the management company when fees are collected. The Property Manager should then remit sales tax to the state from their corporate books.

Step 1: Configure the Sales Tax Agency

Create a Sales Tax Agency

Go to the settings page (click on the ellipsis next to your name in the lower left corner of the page and select Settings)
Click on Sales Tax Agency

Click on the New Sales Tax Agency button and enter the applicable name of the agency in your area. Then Save E.g, New Mexico Taxation and Revenue Department

Step 2: Configure/Create a Sales Tax Setting

In this step you are configuring the tax rate and the default Chart of Account to be used when a sales tax charge is created. The sales tax setting will be applied to a property in step 4.

Go to the settings page (click on the ellipsis next to your name in the lower left corner of the page and select Settings)
Click on Sales Tax

Click on the New Sales Tax button
Fill out the form and Save
- Name - Enter a name
- Agency - Select one of the Tax Agencies from the dropdown menu
- Sales Tax Percent - Enter the applicable tax rate percentage
- Expense Account - Select the default Chart of Account to be used when a sales tax bill is automatically created.
- Income Account - Select the default Chart of Account to be used when a sales tax lease charge is automatically created.

If you need to create a Sales Tax expense and income chart of account(s) you can do so by following this article

How to Create a Chart of Account

You can create multiple Sales Tax Settings if you are managing properties that are using different tax rates.

Be sure to add your default Sales Tax Income chart of account (COA) as an Additional Mgmt Fee (Suppressed Fee) to your management fee setting(s). This will ensure that sales tax will be paid out to the management company when fees are collected and then can be remitted to the state from your corporate books.

Click Here to learn how to add a chart of account as an Additional Mgmt Fee

Step 3: Review which Goods and Services are Taxable (Select which Chart of Accounts are subject to Sales Tax)

Make sure to select the chart of accounts that are subject to sales tax. For example, if Rent, Management fees and General Repairs should be taxed you have to be sure that the Rent, Management Fee and General Repairs chart of accounts (COA) are subject to sales tax.

Go to the settings page (click on the ellipsis next to your name in the lower left corner of the page and select Settings)
Click on Chart of Accounts

Go through the list of income and expense accounts and review which of those chart of accounts should be subject to sales tax (sales tax will be automatically added when used). If Subject to Sales Tax is green it means the chart of account is already configured to have sales tax added to it.
If you need to make a chart of account Subject to Sales Tax, click on it so you can modify it. Click EDIT and toggle on is Subject to Sales Tax. Click Save.

Example of an Income Account

If you need to add sales tax on management fees, it is important to configure your Management Fees chart of account (COA) properly and to ensure that the "Is Subject to Sales Tax" option is turned on for the relevant account. This will ensure that sales tax is automatically added on management fees when the management fees are collected.

Example of an Expense Account

Step 4: Set the Property(s) that you want to charge Sales Tax

Choose which properties to charge Sales Tax

From the left navigation menu click on Property/Properties Search for the property that you want to charge Sales Tax.

Select the property and the go to the Settings tab of the property. Click on Edit and select the applicable Sales Tax Setting from the dropdown menu. Click Save.

Step 5: Specify the Vendor(s) for whom you would like to apply Sales Tax while generating a bill with the vendor as the payee.

When creating bills to pay vendors, choose which vendors you want to automatically apply sales tax to their bill.

There is no need to specify the property management company if you have configured the default management fee expense COA as subject to sales tax, the sales tax will be automatically added to the management fee bills that are created through the "Bill Management Fee Process".

From the left navigation menu click on Contacts / Vendors Search for the vendor that you want to enable Billing Sales Tax

Select the vendor and the go to the Tax Information section. Click on Edit and turn on Enable Billing Sales Tax. Click Save.
Once the vendor is configured, next time you create a bill where the vendor, COA and the property are subject to sales tax, the sales tax will be automatically added to the bill.