To select one tax procedure TAXEUR versus separate tax procedures for EU

[Former Member]

Hello,

We have 8 European company codes in scope and we are struggling to choose separate tax procedure for each country versus TAXEUR for all countries (Belgium, UK, Germany, France, the Netherlands, Spain, Italy and Luxembourg). We have a combination of tax codes multiplied by number of countries a total of approx. 500 tax codes and we think that if we choose one tax procedure TAXEUR then we need to only maintain tax codes specific to countries where they are appied and this will result in simplified tax code maintenance.

Example: If we have the following tax codes:

G1 - UK VAT

G2 - UK VAT 0%

B1 - Belgian VAT

B2 - Belgian VAT

We want to maintain VK11 condition and FTXP settings for G1 and G2 in UK only and not in Belgium.

Similarly, we want to maintain B1 and B2 in BE only and not in UK using TAXEUR.

If we use separate tax procedures TAXB for Belgium and TAXGB for UK then we need to maintain G1, G2, B1 and B2 in both the countries BE and GB. Using TAXEUR we hope that the tax codes maintenance should be simplified. There is a "reporting country" field inside FTXP tax code properties and this should be used to identify the tax code to a particular country.

Unfortunately using the TAXEUR and with the above mentioned settings, the invoice is not getting released to accounting until we extend the tax codes to both the countries. We are wondering what is the advantage of using TAXEUR?

How was your experience and do you have a solution?

Thanks a lot

Sharabh

[john2023]

When using plants abroad you have to decide whether

1 - use TAXEUR and assign it to all the countries where the plants are situated. so if your company code country is UK and your plants are in DE, IT and FR, assign TAXEUR to the countries UK, DE, IT, FR.

Advantage - you just need to manage one tax procedure

                - when new tax codes are required, you just need to ensure that the tax code is created for the one tax procedure

Disadvantage - you need to modify TAXEUR to incorporate the tax calculation and posting requiremnets of the all the countries that this procedure is assigned to.

2 - use separate tax procedures for each country and create tax codes for each procedure(standard SAP provided) . This will cause the following problem - when posting from SD it will determine the DE or IT or FR tax code. But when the billing document is passed to accounting, that tax code will not have been maintained for the UK tax procedure and you will get an error. As a result, you need to replicate the tax codes created for the DE/IT/Fr procedure in teh Uk procedure.

(this is the disadvantage)

The advantage is you dont have to redo the tax procedures of different countries into one procedure.

[ricardo_bellashermida]

Hi,

In our company we have several firms in seven european countries, and we use separated taxed procedures in each one.

I think that in some countries with very especific legislation that requires especific reports in SAP, like Portugal and Poland (SAFt PT for example) requires a especific customizing too, in many cases with tables using the tax codes in each country. For example, in Portugal we have to put each new tax code in a customizing table when this tax code is open.

I hope this information helps you in your decision. 

Regards,

[Former Member]

Hi Ricardo, thanks for your informations.

I'm currently working on an international context with 8 european countries. The Core team hope to use an unique Taxe procedure TAXEUR.

I will try to finds arguments in order to follow the SAP recommendation and the best practice.

[former_member193652]

Hi Sharabh,

Why you don't define different calculation procedure for each country?

As you know TAXEUR is a calculation procedure and you can define as many as required.

Then go into V_005_E and assign each country relevant calculation procedure.

Regards,

Omid

[Former Member]

If you have plant abroad (or not), SAP recommendation is to use separate taxe procedure (note 63103.

In order to simplify the maintenance :

- Simplify your Vat code description

- Reuse common VAT code in different Tax procedure

- Use the reporting country field