Create the VAT and discount rules once on the Sales adjustment screen, give each its ledger and order, then choose them in Configuration so every sales screen uses them.
Open Sales adjustment (menu Account Setup › Sales Adjustment). The list shows each adjustment's Name, Ledger, Adjustment basis, Sign, Category, Order, Adjustment type, Adjustment rate and whether it is Active. The screen warns: "Please make sure that the data you are going to set here is in accordance with the company policy. You will not be able to change this once financial transactions that are against the policy have been entered into the system."
Create the VAT adjustment
1
Choose Add
Who
Accountant
Where
Sales adjustment > Add
2
Fill the form
What changes
Name (for example "VAT 13%"), Basis = Value based, Sign = Increment (+), Category = General, a Ledger (your VAT payable ledger), Rate (13), Order (a number higher than your discounts if VAT should be charged on the discounted price), and tick VAT adjustment.
Needs
A Order not already used by another adjustment of the same category and product-wise setting.
3
Save
What changes
The adjustment is available to choose in Configuration.
4
Name it in Configuration
Who
Administrator
Where
Configuration > Sales > VAT
What changes
The sales screens now use it for VAT. Do the same for Sales product discount and Sales invoice discount.
The fields
Field
Notes
Basis
Value based: a percentage. Quantity based: a rate for each unit
Sign
Increment (+) adds, Decrement (-) takes off (a discount)
Category
General, Additional, Free, Round Off
Ledger
Where the amount is booked. A discount ledger is usually an expense or a sales-adjustment ledger
Formula
Used by adjustments that are not a plain percentage
Product wise
The adjustment is worked out on each line, as Product adjustment
Stock valuation, Profit
Whether the adjustment counts in stock valuation or in the profit figures of reports
VAT adjustment, Luxury tax term
Marks the adjustment as VAT or luxury tax so reports find it
