Calculating Freight in taxes in ERPNext

Use case: Calculate freight forwarding charges with a tax rate

When freight forwarding charges need to be calculated as a tax rate, follow the steps below.

1. Create a ledger for freight charges under the tax or expense accounts in the Chart of Accounts, for example, Freight and Forwarding Charges. Alternatively, you can use an existing tax account for calculating the freight charges.

2. Create a non-stock Item named Freight and Forwarding, with Maintain Stock unchecked and Allow Purchase checked.

3. Create a Purchase Invoice for the supplier and add this item. In the Purchase Taxes and Charges table, add a row with the freight account as the Account Head. Set the Type to On Net Total or On Item Quantity, as per your company policy, and enter the Tax Rate.