SAP’s standard VAT determination logic, largely unchanged since the 1980s, struggles to keep pace with today’s complex VAT rules and modern business models. Intra-community EU transactions, intercompany operations, chain transactions, drop shipments, and pick-up transactions create challenges that standard SAP cannot fully address.
KGT’s SAP add-on automates VAT determination for outgoing invoices, enhancing standard SAP functionality to accurately reflect complex VAT requirements. It ensures that all conditions for applying the correct VAT rate, including the 0% rate, are met - reducing the risk of assessments and penalties from tax authorities.
Key Features
- Automated VAT Determination: Accurately calculate VAT for outgoing invoices based on complex rules and business models.
- Support for Modern Transactions: Handles intra-community, intercompany, chain, drop shipment, and pick-up transactions.
- Enhanced SAP Functionality: Extends standard SAP VAT logic with client-specific enhancements.
- Compliance Assurance: Ensures correct application of VAT rates, including the 0% rate where applicable.
- Seamless Integration: Works within SAP ECC and S/4HANA without additional interfaces.
Benefits
- Reduce Tax Risk: Avoid incorrect VAT treatment and potential assessments from authorities.
- Support Complex Business Models: Ensure accurate VAT application across diverse transaction types.
- Operational Efficiency: Automate VAT determination to minimize manual adjustments and errors.
- Regulatory Compliance: Maintain adherence to evolving VAT rules while leveraging existing SAP infrastructure.
- Enhanced Control: Integrate into your Tax Control Framework for consistent, auditable VAT processing.
VAT has shifted from straightforward domestic rules to complex EU intra-community transactions, intercompany dealings, chain transactions, and new models like drop shipments and pick-ups, all requiring more advanced VAT logic. Standard SAP VAT determination logic has not kept pace with these developments, often resulting in incorrect or incomplete VAT treatment without additional functionality.
The add-on automates VAT determination for outgoing invoices, extending SAP’s standard functionality with advanced VAT logic tailored to modern business requirements.
It ensures correct VAT treatment across complex transaction types, reducing the risk of misapplication of VAT rules and strengthening compliance during audits.
Yes. The add-on is designed to enhance SAP capabilities and can be tailored to meet the specific VAT determination needs of different business models within an organization.