How to Set-Up Customer Exemptions

How to Set-Up Customer Exemptions

If your business has received an exemption certificate from one of your customers, the exemption must be configured so that this customer is no longer calculated tax on any of their invoices.  Customer exemptions can be managed in either your billing or e-commerce platform or configured within CereTax.  To configure customer exemptions within CereTax, follow the steps below.

Create the Rule Type

1. Once logged into CereTax, navigate to Rules >Manage Rule Types

2. Select the Profile that this Rule Type is for. If there is only one Profile, this should already be displayed as the default

3. Click + Rule Type

4. Enter the Rule Type Name

5. Select the Rule Level. For this type of configuration, the Rule Level will be Invoice Line

 6. Click Create Rule Type

Set the Criteria and Action Elements

1. Click the Edit icon next to the newly created Rule Type

2. Set the Criteria element as Customer Account by dragging the customerAccount field to the Criteria Element Table

3. Set the Action elements by dragging the following fields to the Action Element Table:

• ‍taxExemptionCodes.reason – this allows you to enter a reason for the exemption. If this field is utilized, the reason will be included on your CereTax reports.‍
• taxExemptionCodes.state – this allows you to specify a state for the exemption.‍
• taxExemptionCodes.taxLevel – this allows you to select which jurisdiction levels the exemption is for (state, county, city, etc.).  When used, this will exempt ALL taxes within that jurisdiction level.‍
• taxExemptionCodes.taxType – this allows you to select a specific tax type for the exemption (ex. sales tax).  When used, this will only exempt the specified tax type, other taxes may still apply.

 4. Click Save Elements

Create the Rule

1. Navigate to Rules > Manage Rules

2. Select the Profile that this Rule Type is for. If there is only one Profile, this should already be displayed as the default.

3. Click Set-up New Rule

4. Fill out the following fields on the Create Rule form:

• ‍Rule Name: Enter a name for your rule, ex. “Customer Name”. This field has a maximum value of 50 characters‍
• Description: If desired, enter a description for this customer. This field has a maximum value of 200 characters,‍
• Start Effective Date: Enter the start date this exemption is in effect for, ex. 01/01/2024‍
• End Effective Date: Enter the expiration date for this exemption, ex. 12/31/2027‍
• Rule Type: Select the Rule Type that was created in the previous step‍
• Status: Select Active

Add the Criteria Elements

1. Click + Add criteria

2. Fill out the following fields on the Add Criteria form:

• ‍Criteria Element: select customerAccount from the drop-down‍
• Operator: select equals from the drop-down.
• Select Value and enter the Customer ID for your customer.  This must match the value from your billing or e-commerce platform.

 3. Click Add Criteria

Add the Action Elements

1. Click + Add action

2. Fill out the following fields on the Add Action form:

• ‍Action Element: select taxExemptionCodes.reason from the drop-down.
• Select Value and enter the reason for the exemption, ex. Resale.

3. Click Add Action

4. Click + Add action

5. Fill out the following fields on the Add Action form:

• ‍Action Element: select taxExemptionCodes.state from the drop-down.
• Select Value and select the state(s) for the exemption. Multiple states can be selected, but the Start& End effective dates previously entered will be in effect for all states selected under this rule.

 6. Click Add Action

7. Click + Add action

8. Fill out the following fields on the Add Action form:

• ‍Action Element: select taxExemptionCodes.taxLevel from the drop-down.
• Select Value and select the tax jurisdiction level(s) for the exemption.

If the exemption you are configuring is for all taxes, this is the recommended approach and you do not need to set up an additional action element for taxExemptionCodes.taxType

If the exemption you are configuring is for specific taxes only, then omit taxExemptionCodes.taxLevel as an action element and use taxExemptionCodes.taxType instead.

In some cases, you may need to use a combination of both taxExemptionCodes.taxType & taxExemptionCodes.taxLevel

9. Click Add Action

10. Click + Add action

11. Fill out the following fields on the Add Action form:

• ‍Action Element: select taxExemptionCodes.taxType from the drop-down
• Select Value and select the tax type(s) for exemption, ex. 130 - SALES TAX

12. Click Add Action

Save & Sync the Rule

1. Once returned to the Create Rule screen, click Create Rule.

 2. Once returned to the main Manage Rules screen, click Sync Rules