To model tax exceptions

For situations in which the derived tax code is incorrect, you can define tax code exceptions. A tax code exception is a set of transaction details for which you define a tax code and/or tax country and business partner tax country other than the values that result from the standard tax code derivation.

For example, if you want to use a specific tax code for purchase transactions with a specific tax classification or a specific ship-from country and delivery terms, you can define a tax code exception.

To define tax code exceptions, take the following steps:

  1. In the Company Sets (tctax0170m000) session, define one or a number of financial company sets.

  2. In the Companies by Company Set (tctax0171m000) session, add financial companies to the company set. Ensure that each financial company belongs to only one financial company set.

    To define the tax exceptions for a single financial company, create a company set that contains only one company.

  3. For the financial company set, define the tax exceptions in one of the following ways:

    • For individual countries, use the Model Tax Exceptions by Country (tctax1100m000) session.

    • For a number of countries for which the same exceptions apply, use the following sequence of sessions:

      • Country Groups (tctax0120m000)
        Define the tax country groups.
      • Countries by Country Group (tctax0121m000)
        Add countries to the tax country group.
      • Model Tax Exceptions by Country Group (tctax1101m000)
        Define the tax exceptions for the country group.
  4. In the Tax Handling Parameters (tctax0100m000) session, ensure that you select Exceptions by Country in the Search Sequence 1 field.
  5. Use the Test Tax Model (tctax8100m000) session to test the resulting tax code and tax country in various situations, and make the necessary adjustments.

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