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Automatic Tax Code Determination for Invoices

By  Deloitte Consulting & Advisory BV

This extension on OpenText Vendor Invoice Management for SAP Solutions (also known as SAP Invoice Management by OpenText) provides automatic tax code determination for both PO and non-PO invoices.

This solution will enable the client to further automate the handling of PO and non-PO invoices by automating the assignment of a tax code.

Deloitte Consulting & Advisory BV


Ultimate objective of invoice processing automation is to tend to a “no-touch” process, where the invoices go straight through from validation to posting.

To achieve that, a tax code is needed for all line items of both PO and non-PO based invoices.

The Automatic Tax Code Determination by Deloitte has the objective to assign a correct tax code to each line item of PO and non-PO invoices using master data and PO data (for PO invoices) similarly to other existing logics. The biggest advantage of Deloitte’s logic is that invoice data is also used, and this data is only known as soon as the invoice enters the organization. Let’s take the example of a Belgian vendor that also has a French and a German VAT number. The one to be used is only known at invoice reception.


Of course, other possibilities exist for tax code determination, e.g. by manual maintaining the tax code at PO creation, by using tax engines or tax code condition tables. The difficulties with these approaches are diverse: it impacts the purchasing department negatively, integration can be complex and expensive or the data is just not available.


How does it work?
The logic takes place as soon as the invoices enter OpenText Vendor Invoice Management for SAP Solutions and during exception handling. It acquires data elements for tax code determination, i.e. input parameters for the tax condition table. Then it looks up tax code from the tax condition table based on those input data and finally assigns a tax code to each line item of non-PO and PO related invoices.


Deloitte is not only providing a tool to automate tax code determination, it also provides customers with a solution that enables or prevents the end user to overwrite the value determined by the logic. If the end user overwrites a value, the Deloitte solution keeps track of it by providing an audit trail on e.g. which user did the change and when.


Deloitte’s added-value
With the Automatic Tax Code Determination solution Deloitte is not only providing the logic but also the content. Deloitte’s tax experts are analyzing customer’s processes and determine a correct tax code for each possible scenario.


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Deloitte Consulting & Advisory BV

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