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Item Tax Template Invalid

We are still looking for some assistance with a very troubling issue which is preventing us from billing and processing invoices for certain items. Since we upgraded to V12, there is an issue with using the Item Tax Templates. This was never an issue before but now when we try to add an item to an order which has some non-taxable items it throws as error message when we try to post any entries (purchase receipts, Purchase invoice or sales invoices). We are effectively stuck as we cannot process any invoices in or out.

Here is the error message we are presented with. This affects our labor items which are non-taxable in the US.

Does anyone know how to resolve this? This Item Tax Template settings a new feature and it is not in the documentation that I can find. We wished that they left the item tax settings under the ITEM itself like it used to be rather than controlled under a tax template.

We are facing same issue.
Anyone found a fix for this?

Stay tuned - note this recently identified in develop branch that may relate to your case

edit: You have referred to the docs, and can suggest what changes are needed? https://docs.erpnext.com/docs/user/manual/en/accounts/item-tax-template

Hi John,
Thanks for your response.

In my case there was some data issue.
I had Tax Category defined on Customer/Supplier and on Addresses, whereas I was not using Tax Category to fetch Sales Tax and Charges Templates, due to this when I removed the Tax Category (fetched from Master) in Sales Invoice, there was a validation error “Item Tax Template Invalid”

I was able to resolve the issue by removing Tax Category mapping from all Masters and making sure my Tax configs are correct.

@AV8 if you look at the way your taxes are configured, you might be able to solve this error.
Let me know if you need help.

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Thanks John & Manan,

I was also able to proceed by removing the Item Tax Template from the item. This new feature, while clearly intended to improve the taxation flow does not seem to work as intended. We are not on the develop branch and we are experiencing issues with this stable release so I think there is still some bugs to work out.

For now we have a work around of removing the item tax template, but we hope there is an effort to address this new feature as it was very difficult to setup and use, especially since there is not much documentation on using the item tax templates.

Good so you found a fix.

Depending on the issue, resources and so on, I believe bug fixes applied to develop may be back ported to version-12 production branch…