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Perspective
An Oracle White Paper
Oct 2007
E-business Tax – A Purchasing Perspective
Purpose ............................................................................................................... 3
Overview............................................................................................................. 3
Prior Tax Structure............................................................................................ 4
Key Concepts..................................................................................................... 6
Integration With Purchasing............................................................................ 8
Tax Events ..................................................................................................... 8
Configuration Owner Tax Options............................................................ 8
Party Tax Profile ........................................................................................... 9
Implementation Considerations........................................................... 10
Country Defaults......................................................................................... 11
Tax Defaulting............................................................................................. 12
Displaying Tax Information...................................................................... 14
Modifying Tax Information ...................................................................... 15
Overriding Tax ....................................................................................... 15
Application Tax Options - Tax Hierarchy .............................................. 17
Supplier .................................................................................................... 17
Supplier Site ............................................................................................ 18
Item .......................................................................................................... 18
Tax Rules...................................................................................................... 19
Expert Rule ............................................................................................. 20
Guided Rule ............................................................................................ 21
Fiscal Classification..................................................................................... 22
Party Fiscal Classification...................................................................... 22
Product Fiscal Classification................................................................. 25
Transaction Fiscal Classification .......................................................... 33
Tax in Interface ........................................................................................... 34
Requisition Import................................................................................. 34
PDOI ....................................................................................................... 34
Tax During AutoCreate ............................................................................. 34
Quantity Based Tax .................................................................................... 34
Tax Setup.......................................................................................................... 36
Upgrade considerations .................................................................................. 41
Data Flow ......................................................................................................... 42
Troubleshooting .............................................................................................. 45
Tax Simulator.......................................................................................... 45
Troubleshooting Tips ............................................................................ 45
Tax Log and File Versions.................................................................... 46
Appendix .......................................................................................................... 48
References.................................................................................................... 48
Oracle Internal References ........................................................................ 48
Tax Determination Attributes................................................................... 49
PURPOSE
Purpose of creating this document is to review impact of Ebusiness Tax introduced
Ebusiness Tax provides a repository to
in R12 to Oracle Purchasing. This document will help you in implementing tax
store tax information and record tax
events. Individual applications (for e.g. solution in Purchasing using R12 Ebusiness Tax solutions. This document will also
Purchasing) avails the tax services help you in understanding the integration and troubleshooting your tax setups in
provided by Ebusiness Tax to Oracle Purchasing.
create/update/display tax information for
its transactions.
OVERVIEW
In release 12 EBusiness Tax has been introduced to provide an improved Tax
solution to customers.
Ebusiness Tax provides a repository to store tax information and record tax events.
Individual applications (for e.g. Purchasing) avails the tax services provided by
Ebusiness Tax to create/update/display tax information for its transactions. The
tax services that can be availed from Ebusiness Tax are listed below.
Architecture has been built considering country specific tax requirements and
applicability of rules for determining taxes. Based on the tax laws of a specific
country, the transaction tax rates may vary by jurisdictions, products or product
category, how the product will be used, type of transacting parties, type of
transactions, the place of supply etc. Various rules are applicable for determining
the appropriate tax on a specific transaction.
E-Business Suite
Transaction Transaction Tax
Oracle E-Business Tax
Tax Services Request Manager
Content
Repository
STax
e r v ic e s Tax Tax
Content Determination Recovery
Record Services Services Services
Repository
Tax Partner
Tax Content
KEY CONCEPTS
Following are some of the key concepts in eBusiness tax as provided by this
product. This will be used further in this discussion.
Tax Regime: A Tax Regime contains the set of tax rules that determine the
treatment of one or more taxes that have been grouped together for administration
or other purposes.
For e.g. VAT Regime in Argentina that sets the rules for Standard VAT, Additional
VAT, and Perception VAT and US Sales Tax Regime in US with State, County and
City/District taxes.
Tax Status: Tax Status is the taxable nature of a product or service in the context of
a transaction for a tax.
For e.g. Zero Rated, Standard Rated etc.
Tax Rate: The rate specified for a tax status in effect for a period of time; the tax
rate can be expressed as a percentage or as a value per unit quantity.
For e.g. Sweden Standard Rate VAT is 25% or US California State Sales/Use Tax
Standard Rate is 7.25%
Party Tax Profile: Holds all party tax related information. For e.g. Party Profile for
Establishments, Party Profile for Suppliers and Sites or Party Profile for Customers
and Sites.
Registrations: The registration of a party with a tax authority that confers tax rights
and imposes certain obligations. For e.g. ESA78211646 (VAT - Spain),
SE123456789012 (VAT - Sweden) etc.
Intended Use Fiscal Classifications: The purpose for which a product may be used.
For e.g. Brazil Intended Use (e.g. Commercialization, Consumption,
Industrialization)
Tax Events
Based on similarity in handling tax
Tax events are classified in purchasing based on the purchasing document types.
information and tax determination tax
Following are the event classes in purchasing.
events are classified based on purchasing
document types. Purchase and Internal Requisition (REQUISITION)
Purchase Orders and Agreements (PO_PA)
Blanket and Scheduled Release (RELEASE)
The above event classes are based on the consideration of whether any tax
determination is necessary and the similarity in the handling of the tax information.
Other options are not updatable for purchasing application and will not available.
This will be the standard behavior in release 12.
By default the ‘Regime Determination Set’ is ‘Determine Applicable Regimes’
which uses the location based taxes. For migrated tax, using ‘Direct Tax Rate
Determination’ with tax classification codes, configuration owner tax options must
be setup to use STCC as the regime determination set.
Implementation Considerations
1. It is necessary to associate a first party legal entity and its main legal
establishment in party tax profiles. In case they have not been associated a
tax calculation error will result while saving the transaction. To create a
new first party legal entity / legal establishment, query the legal entity and
choose the party type as first party legal entity or first party legal
establishment for legal entity and legal establish respectively. Click on the
icon under the label titled ‘Create Tax Profile’. Now follow the
instructions under chapter ‘Managing Tax Profiles and Registrations’ in
Oracle E-Business Tax User Guide to create a new tax profile for both the
legal entity and its main legal establishment.
2. If you had been using tax configurations defined under the ‘Operating
Unit Owning Tax Content’, then tax content defined under the ‘First Party
Legal Entity’ will not be applicable. You may choose to use the tax content
Country Defaults
Country default controls let you default the transaction tax-related values in the
countries that you do business. You can also setup the default ‘Tax Authority’ for
the country. You can default tax regime and tax for tax registrations belonging to
the legal establishment in the applicable country by choosing the option against the
tax regime or tax you entered as the default tax. For more details about this option,
please refer to the Oracle E-Business Tax User Guide.
Tax Defaulting
Regardless of the availability of tax definitions in e-business tax, Purchase
Purchase documents call the eTax documents call the eTax services for tax calculation on saving the purchase
services for tax calculation every time the documents (Requisition/PO/Releases). If calculation results in applicable tax lines,
purchase order is saved regardless of the
then these tax lines are defaulted on the purchase document. Tax calculation is
taxability of the document
based on the values of the 'Tax determination attributes' along with the ‘Additional
line/schedule/distribution.
Tax Attributes’ on purchasing documents. The 'Tax determination attributes', and
‘Additional Tax Attribute’ available on both purchase order and requisitions are
available in the ‘Appendix’ section below. The purchase documents makes a call to
eTax services for tax calculation even if there are no tax definitions available in tax
repository. Therefore ebusiness tax determines the tax applicability and purchasing
only controls calls to the eBTax services. The eTax API is called to avail the eBTax
services to calculate the tax applicability. Once the purchase document is saved the
Manage Tax menu is enabled.
When saving the purchase document, if there are tax calculation errors in ebusiness
tax, a message will be displayed to the user. Subsequently, the tax lines will not be
defaulted. Following is the error message that appears.
For troubleshooting the tax setups, please refer the troubleshooting section of this
article.
Steps:
1. Setup Ebusiness tax.
2. Enter the purchase document details.(PO/Release/Requisition)
3. Save the purchase document (PO/Release/Requisition)
The above tabs will display the tax line details for each shipment in the Schedules
tab and non-recoverable and recoverable tax distributions for each distribution in
the distributions tab.
The Tax page will have the following tabs for requisition.
1. Lines
2. Distributions
If there are no taxes applicable for the purchase document the Manage Tax menu
will still be enabled. There will be no tax lines seen on expanding the 'Details' in the
'Schedules Tab' of this 'Tax' page.
Also the taxability of a shipment (schedule) can be seen from the purchase order
summary (Shipment window > Taxable flag can be added to the ‘Folder View’).
This is no longer available in the ‘Enter Purchase Order’ screen as seen in releases
prior to R12. In other places, if the tax is applied on the purchase order then the
details of the tax on schedule / distributions are available through the ‘Manage Tax’
link.
We can no longer make a shipment as non-taxable by setting the tax classification
to NULL in ebusiness tax. Overriding the defaulted tax with a zero-rated tax
classification is intended to minimize regression due to non-availability of this
functionality.
Tax code details and recovery rate cannot be viewed from the Purchase Order
Summary/Requisition Summary form. In purchase order summary form ‘Taxable
Flag’ will be displayed. This is the only place where we can find the ‘Taxable Flag’
unlike the previous versions where they could be viewed from the distributions and
purchase order entry form. Manage Tax is available as a drop down in the
‘Professional Buyer’s Workcenter’.
Overriding Tax
Steps:
1. Query the purchase document (Purchase Order Summary/Requisition
Summary form) or save the purchase document (Enter Purchase Order
(POXPOEPO)/Enter Releases (POXPOERL))
2. Click on Actions > Manage Tax (Tools > Manage Tax for Requisition) from
the toolbar from Purchase Order Summary/Requisition Summary/Enter
Purchase Order (POXPOEPO)/Enter Releases (POXPOERL) forms.
3. The tax page will appear with details of tax lines. Click on the 'Additional Tax
Information' button.
4. Locate the tax classification field. This field will have the existing tax
classification for each tax line. Choose the new tax from the LOV.
5. Click on Apply and this will navigate you back to the manage tax page. This
page will have the new tax calculation based on the new tax classification rate.
Supplier
You can attach tax to the supplier using the following steps.
Supplier Site
You can attach tax to the supplier site using the following steps.
1. In the tax page navigate to Parties > Party Tax Profiles.
2. Choose ‘Party Type’ as “Third Party Site” and query the Supplier (using
the ‘Party Name’ field) for whom you like to define the tax.
3. Choose the site for which you want to define the tax and click on update
icon (Pencil icon).
4. In the Main Tab check on ‘Allow Tax Applicability’.
5. Check ‘Set for Self Assessment / Reverse Charge’ if this is a self-assessed
tax*.
6. Navigate to Tax Registrations tab and click on ‘Create’ button and add the
tax regimes/taxes applicable to the supplier site.
* A self-assessed tax is a tax calculated and remitted for a transaction, where
tax was not levied but it is deemed as due.
Item
You can attach tax to the item using the following steps.
1. Navigate to Inventory/Purchasing Responsibility.
2. Navigate to Items > Master Items
3. Query the item for which you want to define the tax.
4. Navigate to the ‘Purchasing’ tab.
5. Choose ‘Yes’ from drop down for the ‘Taxable’ field.
6. Now choose the tax from ‘Input Tax Classification Code’ field LOV*.
Tax Rules
E-business tax provides flexibility to define all kinds of taxation rules that you
Tax rules provide flexibility to use the tax
normally encounter in your business scenario. Tax engine requires some of the
as required by the business / tax authority.
The User-friendly interface makes it easier mandatory tax rule types to be defined either by definining defaults available for
for the implementation team to configure these rule types, or by defining tax rules that will determine the value for these
rules based on their requirements. mandatory tax rule types. If both are defined, the tax engine will first use the rule.
In case the rule does not evaluate a value, the default for the tax rule will be used.
Rules can be defined even after the tax is live. Following are mandatory tax rule
types required before enabling the tax for transactions.
Determine Place of Supply - The specific jurisdiction where the supply of goods or
services is deemed to have taken place for tax purposes, for a given tax; it is the
result of the place of supply derivation.
Determine Tax Applicability - The process and the data that identifies all the taxes
that need to be determined/levied for a given transaction; the result will be an
ordered list of applicable taxes.
Determine Tax Registration - The registration of a party with a tax authority to
ensure tax rights; responsibilities and rights are upheld.
Determine Taxable Basis - The arrived at value, quantity or action, on which tax is
calculated, after the tax rules which would affect it have been taken into
consideration for a specific tax. These rules may include deductions, modifications,
exemptions and discounts.
Calculate Tax Amounts - The calculation of tax amount and formula to be used for
calculating this amount.
Expert Rule
The below steps will guide you through a step-by-step process to create a tax rule
using the expert rule. You can alternatively use the ‘Guided Rule Entry’ option to
define tax rules.
For e.g. define applicability of tax only for ship to location as New York City
1. Go to responsibility 'Tax Managers'
2. Navigate to Advanced Setup Options > Tax Determining Factor Sets
3. Click on 'Create' button
4. Enter the following values
a. Tax Determining Factor Set: <Enter a code for your Tax
Determining Factor Set>
b. Name: <Enter a name for your Tax Determining Factor Set>
5. Set Usage: Tax Rules
6. Optionally Enter:
a. Regime Code: <Regime code where the rule will be applicable>
7. Scroll down to the 'Associate Tax Determining Factors' region.
8. Enter the following values
a. Determining Factor Class: <In our case it is 'Geography'>
b. Class Qualifier: <In our case it is 'Ship To'>
Guided Rule
You can also use the Guided Rule entry to define the rules for each tax. This step
guides you through a step-by-step process to create a tax rule. You can alternatively
use the ‘Expert Rule Entry’ option to define tax rules.
For e.g. define applicability of tax only for ship to location as New York City
1. Query the tax in the Tax Configuration > Tax Rules page
2. Click on Guided Rule Entry icon against the ‘Determine Tax Applicability’
rule.
3. Provide a name for the tax rule code and the effectivity.
4. You can choose to apply this rule for all transactions or only for specific
transactions.
Fiscal Classification
Fiscal Classification allows you a way to As already defined ‘Key Concepts’ section, Fiscal Classification is a way that tax
classify each part of your transaction and authority classifies each part of a transaction. It is not necessary to define fiscal
define tax rules based on these
classification to setup taxes in e-business tax. It only allows you to classify each part
classifications. E-business tax allows you
of a transaction so that you may create rules based on them for specific tax
classifications based on party, product
and nature of transaction.
requirements. We can model three types of fiscal classification in e-business tax.
1. Parties involved in the transaction - Party Fiscal Classification
2. Products involved in the transaction - Product Fiscal Classification
3. Nature of the transaction - Transaction Fiscal Classification
The classification is used to categorize parties. For example a tax authority could
claim a reduced tax rate for transaction in which the goods are purchased from a
supplier establishment that have been classified as ‘Research and Development’
organization by the tax authority in order to promote research activities.
Steps:
The below is an example of defining a rule for party fiscal classification for the
above mentioned example:
1. Define Party Classification in TCA
a. Go to responsibility ‘Trading Community Manager’
b. Navigate to Trading Community > Administration >
Classifications
c. Click on ‘Create Class Category’ button.
d. Enter the following details
3. Attach the Party Fiscal Classification to the party in PTP (Party Tax
Profile)
a. Go to responsibility ‘Tax Managers’
b. Navigate to Parties > Party Tax Profiles
c. Select the party type and party from the LOV and click on
‘Go’. In our case choose Party Type as ‘Third Party’ and
Party as the supplier that needs to be defined as a ‘Research
and Development’ type organization.
d. Click on Update pencil icon.
e. Navigate to the ‘Classifications’ tab.
4. Create a new tax status and tax rate. (Follow steps 3, 5 and optionally
6 in-case recovery is required in the section ‘TAX SETUP’ below)
5. Create an Expert / Guided Rule as shown in the ‘Tax Rules’ section
above. Please use the following specification to create the rule.
a. Tax Determining Factor Set
i. Determining Factor Class: Party Fiscal Classification
ii. Class Qualifier: Ship From Party
iii. Determining Factor Name: <'Fiscal Classification
Type Code' defined in step 3 above>
b. Tax Condition Sets
i. Operator: Equal To
ii. Value/From Range: <In our case 'Research and
Development'>
c. Tax Status: <Defined in step 4>
d. Tax Rate: < Defined in step 4>
When Ship From Party has a Party Fiscal Classification Value of ‘Research and
Development’ then apply the tax rate defined in step 4 above.
The classification is used to categorize a product. There are three types of product
classification available in e-business tax.
1. Inventory Based
2. Non-Inventory Based
3. Intended Use Classification
Inventory Based
This is used to classify categories defined in Oracle Inventory. This can only be
used if Oracle Inventory is in installed status. For example, all domestically
purchased items that are used as office supplies, will be sold at a lower rate.
Steps:
5. Create a new tax status and tax rate. (Follow steps 3, 5 and optionally 6 in-
case recovery is required in the section ‘TAX SETUP’ below)
6. Create an Expert / Guided Rule as shown in the ‘Tax Rules’ section
above. Please use the following specification to create the rule.
e. Tax Determining Factor Set
i. Determining Factor Class: Product – Inventory
Linked
ii. Determining Factor Name: <'Fiscal Classification
Type Code' defined in step 4 above >
f. Tax Condition Sets
i. Operator: Equal To
ii. Value/From Range: <In our case 'Office Supplies'>
(Please note the value of the category segments are
concatenated without delimiters therefore query this
LOV with value of one of the segments and use the
category description to choose the correct segment)
g. Tax Status: <Defined in step 5>
h. Tax Rate: < Defined in step 5>
7. Create a purchase order with category ‘Office Supplies’. The rate should be
one created in step 5 above.
If the category used in purchase order is ‘Office Supplies’ then apply the rate used
in step 5 above.
Non-Inventory Based
This is used to classify categories that are not defined in Oracle Inventory. The
advantage of such a classification is that, it can also be used if Oracle Inventory is
not in installed status. We will continue to use the above example we without using
Oracle inventory example, all purchased items that are used as stationary materials
for your office supplies, will be sold at a lower rate.
Steps:
1. Define a ‘Product Fiscal Classification’ for the non-inventory category in
e-business tax.
a. Go to ‘Tax Managers’ responsibility.
b. Navigate to Products > Product Classifications
c. Product Classification Source: From the drop down ensure to
choose Oracle E-Business Tax.
d. Click on ‘Go’ button.
e. This would retrieve the seeded fiscal classification type code:
PRODUCT_CATEGORY.
f. Click on the pencil icon below the ‘Update’ field of
PRODUCT_CATEGORY fiscal classification code, to update
the information in this category.
g. Click on ‘Create’ button to create a new category.
h. Enter the following details
i. Fiscal Classification Code: <Enter a code for the fiscal
classification which will be used as the category>. In our
example we will define it as ‘OFFICE_SUPPLIES’
ii. Name: <Enter a name for the fiscal classification which
will be used as the category>. In our example we will
define it as ‘Office Supplies’
iii. Effective From: <Enter an effective date>
i. Click on ‘Apply’
j. You will now be able to view the ‘OFFICE_SUPPLIES’ under
‘PRODUCT_CATEGORY’. (If you are not able to view it. Click
the Next 5 arrow to check the entire list under
‘PRODUCT_CATEGORY’).
k. You may create sub categories by clicking on the ‘+’ icon under
‘Create Sub – Level’ heading. For example in our case we will
create a sub-category called ‘STATIONARIES’.
l. Enter the following details
2. Create a new tax status and tax rate. (Follow steps 3, 5 and optionally 6 in-
case recovery is required in the section ‘TAX SETUP’ below)
3. Create an Expert / Guided Rule as shown in the ‘Tax Rules’ section
above. Please use the following specification to create the rule.
a. Tax Determining Factor Set
i. Determining Factor Class: Product – Non-Inventory
Linked
ii. Determining Factor Name: ‘Product Category’
b. Tax Condition Sets
i. Operator: Equal To
If the ‘Product Classification’ field entered in additional tax information page from
the ‘Manage Tax’ link on the purchase order is ‘Office Supplies/Stationeries ’ then
apply the rate used in step 2 above.
Intended Use
This is used to classify transactions based on purpose for which a product maybe
used. There are two types of intended use.
1. Inventory Based
2. Non-Inventory Based
For upgraded instances intended use is always inventory based. For non-upgrade
customers this choice can be made only once.
Example of Intended Use can be recovery tax on alcohol is based on its use. If it is
used for ‘Industrial Manufacturing’, the recovery rate will be higher than when it is
used for direct ‘Retail Sale’. In this whitepaper we will discuss example of inventory
based ‘Intended Use’. The difference is that for inventory based defaulting
automatically occurs when we choose the inventory-based items. While for non-
inventory based intended use, the Intended use must be explicitly specified from
the ‘Intended Use’ field seen from the ‘Additional Tax Information’ page after
navigating to the tax page though the ‘Manage Tax’ link. Also for non-inventory
based intended use, the codes for ‘Intended Use’ must be created in e-business tax.
Steps:
1. In Oracle Inventory define categories for intended use. For e.g. in our case
we will define a category called ‘Industrial Use’ and ‘Retail Sales’. (Please
refer to the page 4-66 of Oracle Inventory User's Guide for steps to create
an inventory category)
3. Assign items to the categories defined in step 1. For e.g. in our case we will
create an item ‘Industrial Alcohol’ which is a purchased item with the
category ‘Industrial Use’. (Please refer to the page 4-74 of Oracle
Inventory User's Guide for Assigning Items to Categories and page 4-74
of Oracle Inventory User's Guide for defining an item)
4. Create a new recovery rate for your tax. (Follow step 6 in the section ‘TAX
SETUP’ below)
5. Create an Expert / Guided Rule as shown in the ‘Tax Rules’ section
above. Please use the following specification to create the rule.
a. Tax Determining Factor Set
i. Determining Factor Class: Transaction Input Factor
ii. Determining Factor Name: Intended Use
b. Tax Condition Sets
i. Operator: Equal To
If the ‘Intended Use’ of the item in purchase order is ‘Industrial Use’ then apply the
recovery rate used in step 4 above.
User Defined Fiscal Classification: Used for defining transaction based on any
other classifications from transaction other then the above mentioned. For e.g. a
sample sale may invite a lower tax. So users can define a user defined fiscal
classification of type ‘Sample Sales’ and create rules to define tax rates for such a
transaction.
PDOI
2. Tax Rule: In tax rules of for the tax, use the following as default value (Step
7 in ‘TAX SETUP’ section):
a) Determine Taxable Basis: STANDARD_QUANTITY
11. Setup Tax on Source: Depending on the source from where tax needs to be
defaulted, please define the setups as mentioned in the section for
‘Application Tax Options - Tax Hierarchy’. (i.e. Supplier, Supplier Site,
Item, Ship-To Location or Payables Financial Options). For e.g. for
supplier, following setups are required.
a. In the tax page navigate to Parties > Party Tax Profiles.
b. Choose ‘Party Type’ as “Third Party” and query the Supplier in
the ‘Party Name’ for whom you like to define the tax.
c. Click on update icon (Pencil icon).
d. In the Main Tab check on ‘Allow Tax Applicability’.
e. Check ‘Set for Self Assessment / Reverse Charge’ if this is a self-
assessed tax.
f. Navigate to Tax Registrations tab and click on ‘Create’ button and
add the tax regimes/taxes applicable to the supplier.
You could also view a demonstration of the tax setups for purchasing though
the viewlets attached with this white paper.
UPGRADE CONSIDERATIONS
Following are some of the important impacts upon upgrade. Since the upgrade path
for release 12 is only though 11i, we will only be considering this release in our
considerations for upgrade. Also, this article would discuss only impacts on
purchasing perspective.
1. In release 11i, tax was maintained separately for payables, receivables etc.
The tax used in purchasing was stored in payables and tax calculation API’s
from payables were called for determining tax amount. The tax was
operating unit based. In release 12 a centralized repository will be used to
store taxes from across applications. The tax setup will be upgraded as party-
specific configuration owners, with the operating unit owning the tax setup.
This means that the tax regimes for migrated taxes will subscribe to party
with ‘Operating Unit Owning the Tax Setup’ i.e. the operating unit will still
continue to own the tax.
2. Each tax code, including the tax codes within a tax group, migrates to E-
Business Tax as a tax classification code. Payables and Purchasing tax codes
migrate as input tax classification codes. Each tax code will be migrated with
each tax code having its regime to rate flow. The tax group will also be
migrated as a tax classification, but will not have an associated regime to rate
flow in e-business tax. To group all related taxes classifications under its
related tax group, a direct rate determination rule is created during migration
that will be based on the tax classification code that has the same name as tax
group code. If tax codes are not part of any tax groups then there will be no
Direct Rate Determination rule. You may define additional rules to
determine taxes to be defaulted on a transaction.
3. A new Regime Determination Template Standard Tax Classification Code
(STCC) will be created during migration using determining factor of Tax
Classification Code -which will indicate that the tax calculation would be
based on the old Release 11i approach. This will be available as ‘Regime
Determination Set’ on the configuration tax owner option for the ‘Operating
Unit Owning Tax Content’. When the template is STCC, a shortcut
approach is used to calculate taxes based on the passed Tax Classification
Code. This is a special Regime Determination Template which does not use
Location based Determining Factors. All other Regime Determination
Templates must use location based determining factors.
DATA FLOW
Following is the mechanism of calls to the ebusiness tax to calculate tax.
1. Purchasing will populate tax-determining attributes to global temporary tables.
2. It will then call ebusiness tax API's to calculate tax.
3. Once the tax lines are calculated, appropriate tables in ebusiness tax is populated
with tax details and the purchasing tables are updated to indicate taxable line.
4. The data from the global temporary tables will be deleted.
To get a dump of the eTax setups, you can use the following set of queries.
Please provide the tax regime code when prompted. If the issue is limited to a tax
then provide the tax name when prompted else please leave it blank.
SELECT *
FROM zx_regimes_b
WHERE tax_regime_code = '&tax_regime_code';
SELECT *
FROM zx_taxes_b
WHERE DECODE('&tax_name',null,'xxx',tax) = nvl('&tax_name','xxx')
AND tax_regime_code = '&tax_regime_code';
SELECT *
FROM zx_status_b
WHERE tax = '&tax_name'
AND tax_regime_code = '&tax_regime_code';
SELECT *
FROM zx_rates_b
WHERE tax = '&tax_name'
AND tax_regime_code = '&tax_regime_code';
SELECT *
FROM zx_jurisdictions_b
WHERE DECODE('&tax_name',null,'xxx',tax) = nvl('&tax_name','xxx')
AND tax_regime_code = '&tax_regime_code';
SELECT *
FROM zx_rules_b
Following are the main ebusiness tax tables that will contain the transaction
information that will have the tax details after tax is calculated.
a. ZX_LINES: This table will have the tax lines for associated with PO/Release
schedules.
TRX_ID: Transaction ID. This is linked to the
PO_HEADERS_ALL.PO_HEADER_ID
TRX_LINE_ID: Transaction Line ID. This is linked to the
PO_LINE_LOCATIONS_ALL.LINE_LOCATION_ID
b. ZX_REC_NREC_DIST: This table will have the tax distributions for associated
with PO/Release distributions.
TRX_ID: Transaction ID. This is linked to the
PO_HEADERS_ALL.PO_HEADER_ID
TRX_LINE_ID: Transaction Line ID. This is linked to the
PO_LINE_LOCATIONS_ALL.LINE_LOCATION_ID
TRX_LINE_DIST_ID: Transaction Line Distribution ID. This is linked to the
PO_DISTRIBUTIONS_ALL.PO_DISTRIBUTION_ID
RECOVERABLE_FLAG: Recoverable Flag. If the distribution is recoverable then
the flag will be set to Y and there will be values in the
RECOVERY_TYPE_CODE and RECOVERY_RATE_CODE.
TROUBLESHOOTING
Tax Simulator
Simulator is a powerful user interface too that can be used to simulate Tax
Calculation based on what-if scenarios. It gives flexibility to test new and/or
changed tax rules. Tax Simulator helps on audit trail with respect to which Tax
Rules were satisfied in calculating a particular tax. You can start using the Oracle
Tax Simulator by attaching this responsibility to your user. Navigate to the Oracle
Tax Simulator and enter the Header and Line information as appropriate. Click on
‘Tax Lines’ to display the tax lines for your tax. For detailed steps please review the
tax simulator viewlet attached to metalink Document ID (Note) for this
whitepaper.
Useful Tips:
1. Ship from Ship to and Bill From Bill to LOVs change depending upon the
application selected. Ship To/Bill To information is required for calculation of
location-based tax.
2. First Party locations need to be associated with the legal establishment for the
tax simulator to calculate tax.
Troubleshooting Tips
5. Tax Rules: Check the default place of supply or the rule for the tax. There
should be at least one valid jurisdiction for the place of supply determined.
Check whether the tax is by default Applicable. If not then at least one rule
must be satisfied.
If there is an error while calculation please use the Note 417238.1 to obtain the tax
debug log. Below are the information that will be sufficient for Oracle Support to
progress the service request for any ebusiness tax calculation issues.
1. Set the following profile options on at user level for the user saving the purchase
order.
FND: Debug Log Enabled = 'Y'
FND: Debug Log Level = 'Statement'
FND: Debug Log Module = %
8. You will get a message showing the location of the trace file.
9. Please retrieve trace with tkprof. Run the trace file through tkprof as follows:
tkprof <filename>.trc <filename>.out explain=<found
username/password>
Submit the Request and upload the output of the program for validating the file
version information.
References
Note 417238.1 How to obtain tax debug logfile when using application version 12 or higher
Note 415698.1 Oracle E-Business Tax key benefits, some new features and resource material
Note 458218.1 Defaulted Tax Rate From E-Business Tax Cannot Be Overriden
Note 458320.1 E-Business Tax Calculation Issues After Entering The Next Line/ Deleting
Shipments/ Adding New Shipments in Purchase Order
Note 458218.1 Defaulted Tax Rate From E-Business Tax Cannot Be Overriden
Note 461844.1 E-Business Tax Calculation Error Occurs. Tax Log Shows 'Error Unable To
Get The HQ_ESTB_PARTY_TAX_PROF_ID For Legal_Entity xx'
Note 419415.1 What to do with E-Business tax and Legal Entity SRs?
Line
-------
Item
Unit of Measure
Quantity
Unit Price
Amount
Need-by Date
Tax Classification
Ship-to Organization
Ship-to Location
Supplier
Supplier Site
Additional Tax Attributes (Navigation: Tools > Manage Tax > Additional Tax Information)
---------------------------------
Business Category
Intended Use
User-defined Fiscal Classification
Product Fiscal Classification
Product Category
Assessable Value
Distribution
---------------
Quantity
Amount
Charge Account
Tax Recovery Rate
Project
Task
Additional Tax Attributes (Navigation: Tools > Manage Tax > Additional Tax Information)
--------------------------------
Intended Use
POs/Releases
=========
Header
-----------
PO Document Type
Transaction Currency
Rate Type
Rate Date
Rate
FOB
Supplier
Supplier Site
Bill-to Location
Provisional Tax Determination Date (for Consumption Advice Orders)
Line
------
Item
Unit of Measure
Unit Price
Shipment
-------------
Quantity
Amount
Need-by Date
Tax Classification
Ship-to Organization
Ship-to Location
Source Document (for Scheduled Releases of Planned PO)
Additional Tax Attributes (Navigation: Tools > Manage Tax > Additional Tax Information)
--------------------------------
Business Category
Intended Use
User-defined Fiscal Classification
Product Fiscal Classification
Product Category
Assessable Value
Distribution
----------------
Quantity
Amount
Account CCID
Tax Recovery Rate
Project
Task
Award
Expenditure Type
Expenditure Organization
Expenditure Date
Source Distribution (for Scheduled Releases of Planned PO)
Additional Tax Attributes (Navigation: Tools > Manage Tax > Additional Tax Information)
--------------------------------
Intended Use (defaults from shipment level)
Acknowledgement
I wish to record my sincere appreciation towards:
My team mates Ajith, Mani, Muhittin, Selvan and Subhashini for all their help and feedback in completing this
document. Also Anand Naik and Vasvi Kedia from Product Management, Ranjith Palani and Rajalingam Ramaswamy
of Product Development Team, and Clarina Allen and Janet Flores from Procurement Support team for reviewing this
whitepaper. Thanks to Anand Naik for providing guidance at various situations. A Special thankyou to Andrea
Balasuriya from Product Release Readiness Team for constantly providing help from every direction. I am very grateful
to Chandu Tadanki for his constant encouragement and support.
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