Manage Amazon item discounts at line-level

Contents

• Tax and discount calculation to track discounts as cart-level vs line-level
  • Cart-level discounts
  • Line-level discounts
• Understand line-level discounts for the “sales tax” marketplace
  • Calculate eTail order Line tax for the “sales tax” marketplace
  • Understand NetSuite sales order and its subsequent records with line-level discounts for the “sales tax” marketplace
• Understand line-level discounts for the “GST/VAT” marketplace
  • Calculate eTail order Line tax for the “GST/VAT” marketplace
  • Understand NetSuite sales order and its subsequent records with line-level discounts for the “GST/VAT” marketplace

To sync discounts to NetSuite accurately, the Integration App can apply the discounts at each item level on the sales order, cash sale, or invoice as per configuration value selected in the NetSuite discount item to track Amazon item discounts at line-level (recommended) setting (Settings > Order section > Order tab). The discount amount is applied as a separate negative line item below the original line item on the NetSuite sales order and other order records.

The Integration App ensures that,

• The Sum of item tax and discount tax (negative line) should always match Amazon's net Item tax field value.
• The calculated item price, discounts, and tax values are correctly reflected in all the order related records such as invoice, credit memo, settlement report, refund, and payment without any variance. 

Important: Select a discount item either in the NetSuite discount item to track Amazon line-level discounts (recommended) setting or in the NetSuite discount item to track Amazon item discounts at cart-level setting.

In the NetSuite substitute item to track shipping discount setting (Settings > Order (FBA/MFN) section > Orders tab) select a NetSuite item in the setting to track shipping discount and taxes for the Amazon orders. In NetSuite, create an item of the "Discount" type and select the same in this setting. The order flow creates an order line with this item for the shipping discount amount and taxes. Ensure to select an item in the "NetSuite item to track Amazon Shipping amounts and taxes" setting, before you select a substitute item.

Note: If you use a discount item in the NetSuite discount item to track Amazon item discounts at line-level (recommended) and NetSuite substitute item to track shipping discount settings, then both the discount items should have a GL account added under the Accounting tab of the NetSuite item.

If a shipping discount item is selected and the shipping item is not present in NetSuite, an error message is displayed. 

For line-level shipping, 

• If a substitute item is selected in the NetSuite substitute item to track shipping discount setting, the shipping cost and shipping lines are shown as separate lines on the NetSuite sales order invoice.
  • In the Settings tab > General section > Tax sub-tab, if you check the ​​Enable GST/VAT for your marketplace box, the shipping discount line is calculated based on the rate provided in the Enter GST/VAT rate to apply across all orders setting. 
  • For dynamic GST, the amounts are adjusted as the amount already includes tax.
  • For all the other scenarios, the amounts are considered from the order data.
•  If a substitute item is not selected in the NetSuite substitute item to track shipping discount setting, you can map two-line level fields to track shipping discounts on the order flow:
  

  Source record field (Amazon Seller Central)	Destination record field (NetSuite)
  OrderItem[*].ShippingDiscount.Amount	Items : Amazon Shipping
  OrderItem[*].ShippingDiscountTax.Amount	Items : Amazon Shipping Discount

  

• For the auto-billing flows, the order flow copies the shipping discount line if present, and tax rates and amounts are calculated appropriately. 
• For settlements,
  • If an invoice has a shipping discount line then, a separate line is added to the credit memo based on the Amazon settlement report.
  • The credit memo should be in sync with the settlement report and parent invoice record.

Tax and discount calculation to track discounts as cart-level vs line-level

Cart-level discounts

If you want to calculate discounts at the cart-level, 

• For the “sales tax” marketplace, you can control the behavior:
  • Check the Apply Before Sales Tax checkbox on the NetSuite discount item if you are applying taxes at cart-level for the “sales tax” marketplace.
  • Uncheck the Apply Before Sales Tax check box if you are calculating the taxes at line-level and if you are selecting a discount item in the NetSuite discount item to track Amazon item discounts at cart-level setting.
• For the “GST/VAT” marketplace, you can’t control the behavior due to NetSuite limitations. For more information, refer to the Applying VAT Before or After Discounts topic (Accounting > Taxation > Legacy Tax > General International Tax Topics > Applying Sales Tax or VAT to Discount Items > Applying VAT Before or After Discounts) in the NetSuite help documentation. Due to the above-mentioned reasons, for the “GST/VAT” marketplaces, it is recommended to use line-level discounts. 

Line-level discounts

• The Apply Before Sales Tax checkbox on the NetSuite discount item is not applicable when the discount is tracked at line-level for the “sales tax” and “GST/VAT” marketplaces.

Understand line-level discounts for the “sales tax” marketplace

Amazon shares the prices in the below format for orders and settlements for the “sales tax” applicable countries. Amazon provides “promotions discount data” as tax exclusive for the “sales tax” marketplaces. For the “sales tax” marketplace, the line-level discounts are calculated before sales tax. Amazon doesn't share any “Promotion Tax,” its shares the Item tax (item tax + promotion tax) in order data and settlement report. The Integration App calculates the promotion tax and displays on the sales order.

Calculate eTail order Line tax for “sales tax” marketplace

For the sales tax marketplaces, as the item price coming from Amazon is tax exclusive, the Integration App:

1. Calculate the net tax percentage using net tax amount and net item price.
2. Based on the calculated tax percentage, the flow calculates the promotion tax for the discount item and displays it in the “eTail order line tax” field on the sales order.
3. The remaining tax amount is displayed against the original item line in the “eTail order line tax” field on the sales order.

Understand NetSuite sales order and its subsequent records with line-level discounts for the “sales tax” marketplace

• Amazon representation of Order: (Item price - Discount)* Tax rate
• NetSuite representation with the cart-level discounts: (Item Price * Tax rate) - Discount
• NetSuite representation with the line-level discounts: (Item Price * Tax rate) - (Discount * Tax rate). In this scenario, (Item Price * Tax rate) is shown as one line, and (Discount * Tax rate) is shown as an additional line on the NetSuite sales order.

Note: The Integration App calculates the tax rate as (Net Tax *100) divided by (Item price-discount).

When you select a discount item in the  NetSuite discount item to track Amazon line-level discounts (recommended) setting, on the NetSuite sales order:

• A new line-item is added against the selected discount item after the original line item.
  
  Example: As per the above screenshot, “Celigo Water Bottle” is the original line item, and “Amazon Discount Item” is the new line-item added.
• The discount item line tax (-ve line) is deducted from the original item line tax and shown in the “Tax Total” field in the body-level (top-right corner in the screenshot).
  
  Example: As per the above screenshot, 15.3 - 1.53 = 13.77 is displayed in the “Tax Total” field.
• In the “eTail Order Line ID” field, for every discount item, “Celigo_Discount_Line” is prefixed for the eTail Order Line ID.
  
  Example: As per the above screenshot, If the “eTail Order Line ID” is 5020145253386, for every newly added line-item, you can find the value in the “eTail Order Line ID” field as Celigo_Discount_Line_5020145253386.
• The order and order line information from the sales order is reflected in the other order records such as credit memo, invoice, payment, settlement transaction, and customer refund.
• The credit memo and invoice will reflect the same values from the sales order.
  
  
• On the customer refund record, you can find the credit memo details and the order total amount (tax inclusive) from the sales order.
  
  
• On the settlement transaction record, you can find additional details regarding the Promotion in the “Promotion Description” field.
  
  
  
  

Understand line-level discounts for the “GST/VAT” marketplace

Amazon shares the prices in the below format for orders and settlements for the “GST/VAT” applicable countries. Amazon provides a “Promotion Discount” as tax exclusive for the “GST/VAT” marketplaces. Amazon shares the “Promotion Tax” only in the settlement report. The Integration App calculates the promotion tax and displays it on the sales order.

Calculate eTail order Line tax for “GST/VAT” marketplace

• Amazon representation of Order: (Item price + Net Tax) - Discount
• NetSuite representation with the cart-level discounts: (Item Price * Tax) - Discount
• NetSuite representation with the line-level discounts: (Item Price * Tax rate) - (Discount * Tax rate). In this scenario, (Item Price * Tax rate) is shown as one line, and (Discount * Tax rate) is shown as an additional line on the NetSuite sales order.

Note: The Integration App calculates the tax rate as (Net Tax *100) divided by (Item price-discount).

For the sales tax marketplaces, as the item price coming from Amazon is tax inclusive, the Integration App:

1. Deducts the tax amount from item price to get the “tax exclusive” amount. (Tax exclusive amount = Item price - Tax amount)
2. Calculate the net tax percentage using net tax amount and net item price.
3. Based on the calculated tax percentage, the flow calculates the promotion tax for the discount item and displays it in the “eTail order line tax” field on the sales order.
4. The remaining tax amount is displayed against the original item line in the “eTail order line tax” field on the sales order.

Understand NetSuite sales order and its subsequent records with line-level discounts for the “GST/VAT” marketplace

When you select a discount item in the NetSuite discount item to track Amazon line-level discounts (recommended) setting, on the NetSuite sales order:

• A new line-item is added against the selected discount item after the original line item.
  
  Example: As per the above screenshot, “Celigo Laptop” is the original line item, and “Amazon Discount Item” is the new line-item added.
• You can find the tax-exclusive price for the original item and the discount item in the Amount field.
• The addition of the “Amount” field value and the “VAT Amt” field value is mentioned in the “Gross Amt” field.
• The discount item line tax (-ve line) is deducted from the original item line tax and shown in the “Tax Total” field in the body-level (top-right corner in the screenshot).
  
  Example: As per the above screenshot, 2.27 - 0.11 = 2.16 is displayed in the “Tax Total” field.
• In the “eTail Order Line ID” field, for every discount item, “Celigo_Discount_Line” is suffixed for the eTail Order Line ID.
  Example: As per the above screenshot, If the “eTail Order Line ID” is 5020141252386, for every newly added line-item, you can find the value in the “eTail Order Line ID” field as Celigo_Discount_Line_5020141252386.
• The order and order line information from the sales order is reflected in the other order records such as credit memo, invoice, payment, settlement transaction, and customer refund.
• The credit memo and invoice will reflect the same values from the sales order.
• On the customer refund record, you can find the credit memo details and the order total amount (tax inclusive) from the sales order.
• On the settlement transaction record, you can find the respective amounts in the individual fields such as “Promotion Amount” and “Promotion Tax.” The descriptions of these two fields are available in the Promotion Description field.