SAP TAX

SAP takes care oI tax calculation, tax postings, tax adjustments, and tax reporting through the
three FI components; namely GL, AP, and AR.
SAP allows taxation at three levels:
1. ational level or Iederal level (Europe, South AIrica, Australia, etc.)
2. Regional or jurisdiction level (USA)
3. ational and Regional level (India, Canada, Brazil etc.)
As the requirement oI tax conIiguration in SAP you should deIine the Iollowing;
O ,80 Amount for T, C,.u,tion
For each Company Code you need to deIine whether the Base Amount includes the cash
discount as well. II the base amount includes the discount, then the tax base is called Gross,`
otherwise, it is et.` You may also deIine a similar base amount Ior calculating
the Cash Discount.` This also has to be maintained Ior each oI the Company Codes.
O T, Cod08
The Tax Code is a 2-digit code speciIying the percentage oI tax to be calculated on the base
amount. While deIining the tax code, you will also speciIy the Tax Type` to classiIy a tax code
relating to either Input Tax` or Output Tax.` The tax types are country speciIic and determine
how a tax is calculated and posted.
O T, R,t0
The Tax Rate is the percentage oI tax to be calculated on a base amount. You will be able to
deIine tax rates Ior one or more tax types when you deIine a single tax code.
O Ch0. Indi.,tor8
By using the check indicators, you conIigure the system to issue Error/Warning Messages when
the tax amount entered manually is incorrect.