Want to derive German domestic tax rates on sales from a plant in GB

[Former Member]

Hi

A UK business unit have a requirement to sell to Germany and to apply German vat rates - as if the sale was a domestic sale in Germany

The selling plant has a country code 'GB' that is linked to a company code also with a country code of 'GB'.

Am concerned with any issues that may arise around finance postings and intrastat reporting.

Want to avoid having to create a new plant in Germany if at all possible.

Thanks

Aedin

[richard_taylor6]

Hi Aedin,

Did you find a solution to the EU Distance Selling issue?

Regards,

Richard.

[Former Member]

Hi Aedin,

If the plant belongs to GB comp code and itself a GB entity as per the system..and if the Ship to also is from DE, then it would be an export Order with an export tax. And I believe it might be 'illegal' or inappropriate to do what you're trying to achieve.

generally if the customer has a VAT number maintained an export tax will be applied and if VAT number is not maintained then the local tax i.e. GB sales tax will be applied.

So not just the FI implications and INTRASTAT but also legal implications should be considered and not a recommended practice I would say.

Regards,

Raghu.

[Former Member]

Hi,

I am pretty certain that this is not illegal.

The revenue term for this is 'distance selling' , whereby on reaching a threshold sales amount a company may register for vat in that country and charge the vat of that country .

I am just wondering if this can be accomodated via code in SAP.

[Former Member]

ok..sorry didn't hear abt this..and no idea.

[Former Member]

It is definitely not illegal, Distance selling occurs when a VAT-registered business in one EU country supplies and delivers goods to a customer in another EU country who isn't registered for VAT. So you are distance selling if all of the following are true:

u2022you're outside the UK but in another EU country

u2022you sell goods to customers in the UK or Isle of Man who aren't VAT-registered

u2022you deliver the goods, or arrange for their delivery - for example, you send them by post or by courier

Customers who aren't VAT-registered might include:

u2022private individuals

u2022some small businesses

u2022businesses that can't register for VAT because their activities are exempt

u2022public bodies

u2022charities

now this will be again depending on the business process but I dont know if you wanna try intercompany, or with something else?

Thanks

Aman

[Shiva_Ram]

You can try by creating a separate storage location in the GB plant. Add the German address for the storage location. Create Stock transport order and move the goods from GB to Germany. Modify the output print programs(of delivery) to pull the storage location address so that it reflects German address. Then when regular sales order+delivery is created, enter the German storage location in it. This will resolve the issue.

Regards,

[reazuddin_md]

Hello Collins,

This is common business practice in Global comp's. I dont think with std SAP code you will achive this. But would like to explain you work around.

You might be knowing customers for whom delivery happens from plant which is not belongs to Sales Org / Ship to Country.

( In general we identify this type of sale as Intercompany). Below two points have to take care.

1- When dep plant country is not equal to Sales org country. then set the tax class ( customer) - X

2- If Cust. tax class = X, then update the Dep country = Sales Org country

3. Maintain tax cond rec for VAT with Dep cntry / cust. tax class / Mat tax class

Eg: DE / X/ 1 - Vat rate

this code has to include in both Order - invoice level.

hope it helps.

Regards,

Reazuddin MD

[jignesh_mehta3]

Hello,

I believe this is very much possible with Plant Abroad Settings.

SAP has come out with Plants Abroad for EU Countries & Intrastat reporting where you can have a VAT Registration in the another Country (which is not the Country of Company Code).

Follow this:

IMG - Financial Accounting (New) - Financial Accounting Global Settings (New) - Tax on Sales/Purchases - Basic Settings - Plants Abroad -

1. Activate Plants Abroad.

2. Enter VAT Registration Number for Plants Abroad

IMG - Sales and Distribution - Basic Functions - Taxes - Plants Abroad

One of the basic setting in SD is In Item Category you need to set the Billing Relevance to J - Relevant for deliveries across EU countries

IMG - Sales and Distribution - Foreign Trade/Customs - Periodic Declarations - Special Processing For Plants Abroad

Hope this helps,

Thanks,

Jignesh Mehta