Oracle R12 EBTAX [oraclefinancials.eu]

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Presentación sobre Oracle EBTAX por cortesía de www.oraclefinancials.eu (visite nuestro blog)

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  • <Course name> <Lesson number> - What is E-Business Tax (eBTax) eBTax is a new product that provides the infrastructure for tax knowledge management and delivery using a global system architecture that is configurable and scalable for adding country specific tax content. As the single point solution for managing transaction-based tax, Oracle E-Business Tax uniformly delivers tax services to all E-Business Suite business flows through one application interface. Note to 11i customers: eBTax replaces the transaction tax solutions of Release 11i built into the Oracle Payables and Oracle Receivables products. It also eliminates the need for Brazilian Payables Tax solution (Brazilian AP/PO Tax). Latin Tax Engine of Release 11i for Order-to-Cash transactions of Brazil, Argentina and Colombia is still supported in Release 12. From an end users point of view, eBTax and the Latin Tax Engine are two mutually exclusive tax engines, but the Latin Tax Engine does leverage some services of Oracle E-Business Tax internally. Similar to Oracle E-Business Tax, tax lines calculated by Latin Tax Engine are also stored in eBTax Tables. Tax Reporting of Latin Taxes is now being done using eBTax’s tax reporting ledger interface tables. Though eBTax is an entirely new product, customers upgrading from Release 11i are not required to re-implement their tax setup. You can continue to get the same tax calculation results as in Release 11i.
  • <Course name> <Lesson number> - Answer: a Quiz Specifications Oracle E-Business Tax uniformly delivers tax services to all E-Business Suite business flows through one application interface.
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  • <Course name> <Lesson number> - Business Requirements Met by eBTax Sales and Use Tax in Procurement Allows the definition of jurisdiction-based taxes, such as US Sales and Use Tax Allows you to leverage US Sales Tax setup configured in Receivable in 11i to be used in Payables Self-Assessed Tax in Payables Allows you to self-assess (reverse-charge) taxes on your Payables invoices Multiple Registrations Allows you to define multiple registrations for a Party or site for different taxes or jurisdictions Deferred Tax in AP eBTax allows you to account for recoverable taxes at the time and to the extent of payment in Payables, similar to behavior in Receivables in 11i Enhanced Handling of Tax on Freight Enhances handling of tax on Freight, with the ability to define different rules for freight Enhanced Exemptions and Exceptions Allows you to define exemptions specific to a regime, tax or jurisdiction for a party Allows you to define exceptions specific to a regime, tax or jurisdiction by product fiscal classifications Multiple Inclusive, Compounding Allows you to define multiple inclusive taxes as well as supporting compounding taxes and surcharges (i.e., tax on tax) Quantity Based Rates in Procurement Allows the use of Quantity based Tax Rates to be unit based, e.g., $0.25 per US Gallon
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  • <Course name> <Lesson number> - Key Concepts: Tax Authority Tax Authority is a government entity that regulates tax law, administers, and/or audits one or more taxes. Some examples of Tax Authority: Brazil - Secretaria da Fazenda Estadual (State Revenue Office) Brazil - Secretaria da Receita Federal (Federal Revenue Office) California, USA - California State Board of Equalization Canada -Canadian Customs and Revenue Agency France - Ministry of Economy, Finance and Industry Germany - Federal Ministry of Finance India - Central Board of Customs and Excise Singapore -Inland Revenue Authority of Singapore United Kingdom - HM Customs and Excise
  • <Course name> <Lesson number> - Key Concepts: Tax Regime Tax Regime is the set of tax rules that determine the treatment of one or more taxes administered by a tax authority. Some examples of Tax Regime: Brazil - RICMS -> ICMS Regulation Brazil - RIPI -> IPI Regulation California, USA - California Sales Tax Canada - Canadian Goods and Services Tax India - Excise Tax Singapore - Singapore Goods and Services Tax United Kingdom - UK VAT
  • <Course name> <Lesson number> - Key Concepts: Tax We can define Tax by a classification of a charge imposed by a government through a fiscal or tax authority. Some examples of tax: Tax Regime: Taxes: ------------------------------------------------ ---------------------------------------------------- RICMS - Regulamento do ICMS ICMS, ICMS-ST (Tributary Substitution) RIPI - Regulamento do IPI IPI California Sales Tax State Sales Tax California Sales Tax District Sales tax Canadian Goods and Services Tax GST Canadian Sales Tax PST India Excise and Customs Excise Tax Singapore Goods and Services Tax GST UK VAT UK VAT
  • <Course name> <Lesson number> - Key Concepts: Tax Jurisdiction Tax Jurisdiction is a geographic area where a tax is levied by a specific tax authority. Some examples of Tax Jurisdictions: Tax Geographic Zone Jurisdiction -------------- ----------------------- -------------------------------- ICMS São Paulo Sao Paulo ICMS IPI Brazil Brazil IPI State Sales Tax California (State) California State Sales Tax County Sales tax San Francisco (County) SFO County Sales Tax GST Canada Canada GST PST Ontario Ontario PST Excise Tax India India Excise Tax GST Singapore Singapore GST UK VAT UK UK VAT
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  • <Course name> <Lesson number> - Architecture Overview Oracle E-Business Tax consists of a tax knowledge base, a variety of tax services that respond to specific tax events, a set of repositories (for tax content and tax recording) that allow customers to manage their local tax compliance needs in a proactive manner, as well as the ability to integrate with external tax content providers through a single integration point.
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  • <Course name> <Lesson number> - Processing Taxes for Transactions At transaction time, transactional applications within the Oracle E-Business Suite such as Purchasing, Payables, Sales, Receivables etc. pass determining factors to eBTax. Determining factors can also be derived from information available on the transaction and are the key building blocks of the tax rules. They fall into four groups: Parties: Information about the party such as party classification, registration, exemptions. For example: Legal Entities First and Third Party Ship From/To, Bill From/To, etc. First and Third Party Tax Registrations, Classifications Places: Information on the geography of places associated with the transactions such as: Party Locations Define and Validate Party Locations Products: Information on the types of goods and services on the transaction such as: Product Type (Physical Nature) Item Categories Fiscal Classifications Intended Use Processes: The types of transactions for which tax services are being requested, for example: Document Type Transaction Business Categories Transaction Fiscal Classifications This information is passed to Oracle E-Business Tax through a single and uniform product interface. Then, eBTax: Determines tax regimes and applicable taxes. Determines Tax status. Identifies the appropriate tax rate belonging to the tax status and/or tax jurisdiction Calculates tax amount by multiplying the taxable basis by the tax rate. Stores calculated taxes the form of tax lines in the tax repository. These tax lines have all necessary information needed for tax reporting. At this point you can extract tax reports from the repository and display the date in formats such as PDF, HTML and RTF as required.
  • <Course name> <Lesson number> - Tax Determination Services Example Shown here is a Receivables transaction. This example shows how Oracle E-Business Tax answers some basic business questions during its Tax Determination process. Tax Regimes are identified based on the countries of the parties involved. A default value or a Place of Supply rule indicates the Place of Supply.
  • <Course name> <Lesson number> - Tax Determination Services Example A default party type value or a tax registration rule determines from which party (1st party or 3rd party) to evaluate tax registration status. The party classification is derived from the parties available in the transaction (1st and 3rd parties) and that classification can be compared to the ones used as tax determining factor in any rule type.
  • <Course name> <Lesson number> - Tax Determination Services Example In the Transaction Lines window, other types of information are relevant for tax calculation: Quantity times Unit Price is the default seeded Taxable Basis formula, but other formulas can be defined. The item available in a given transaction line can potentially have one or more product classifications, and these classifications can be used as a tax determining factor in any rule type. The item itself or its classifications can also be used as part of Tax Exceptions definition.
  • <Course name> <Lesson number> - Tax Determination Services Example In the Detail Tax Lines window, the Tax Rate times Taxable Basis is the default seeded Tax Amount formula, but other formulas can be defined.
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  • <Course name> <Lesson number> - User Interface Home: Displays shortcuts to all required configuration set up tasks, including external dependencies. Tax Configurations: Use this tab to configure Tax Regimes, Taxes, Tax Statuses, Tax Jurisdictions, Tax Recovery Rates, Tax Rates, Tax Rules Products: Create and/or modify Product Classifications, Intended Use Classifications, and Tax Exceptions. A product fiscal classification is a classification of products, according to their tax requirements, for tax determination and tax reporting purposes. A product fiscal classification is based either on Oracle Inventory category sets or E-Business Tax product categories. Parties: Create and/or modify Party Tax Profiles, Party Classification, and Legal Classification Tax Usage Transactions: View and update Transaction Business Categories, Transaction Fiscal Classifications, Document Classifications, User Defined Transaction Classifications, Event Class Settings Defaults and Controls: Create and/or update Country Defaults, Tax Reporting Types, Configuration Owner Tax Options, and Application Tax Options Provider Services: Create and view Service Mappings and Extensions Advanced Setup Options: View and modify Tax Lookup Codes, Tax Determining Factor Sets, Tax Condition Sets, Tax Formulas, Tax Zone Types, Tax Determining Factors Requests: Schedule Requests or Request Sets, or Monitor Requests.
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  • <Course name> <Lesson number> - Tax Definition Hierarchy Responsibility: Tax Managers Navigation: Tax Configuration > Tax Regimes You can now define an entire tax setup hierarchy, starting from the definition of tax regimes, then the taxes belonging to those regimes, the tax statuses belonging to each tax and lastly, the tax rates associated to each tax status. In addition, tax jurisdictions and jurisdiction rates, can also be defined for those taxes. The hierarchy gives ease of navigation, visualization and maintenance. Instead of replicating choices for different Operating Units (OUs), you define which regimes need to support recovery / Exemptions / Exceptions / Overrides Define Tax Regime level defaults that are common across all associated taxes. They can be overridden at the tax level. A Tax is defined by a Configuration Owner. Though multiple OUs can share data by using data defined by a common content owner, the upgrade process creates one content owner for each tax A Tax is defined with a geography type (country / state, etc.) level to understand the hierarchy across taxes Define granular controls at the tax level, instead of controlling the behavior at highest level (OUs) or too low levels such as tax rate codes. They can be overridden at lower levels. Instead of repeating taxes, define multiple jurisdictions for the same tax. e.g. US State Sales Tax can have several state level jurisdictions A default Tax Status can de defined for a tax having one or more tax statuses. In the absence of a Tax Status determination rule, the default Tax Status will be picked up. All upgraded rate codes are associated with ‘Standard’ Tax Status Tax Rate Codes are upgraded with null jurisdiction. Jurisdiction based rates in US will be upgraded in the context of Tax Status and Jurisdiction Define date effective period and/or navigate to details for Account information / lowest level controls / defaults
  • <Course name> <Lesson number> - Tax Configuration Ownership Tax Regimes created for 11i US (jurisdiction) based taxes, are made available as Common Configuration to share data across OUs Tax Regimes created for 11i non US based taxes are made available as Party Specific Configuration
  • <Course name> <Lesson number> - Tax Defaulting Hierarchy The 11i Tax Code/Group Code (defaulted) on taxable lines drives the applicability of tax rates for the given taxable line. In R12, the tax classification code (defaulted) on taxable lines drives the applicability of one or more taxes using Direct Rate Determination rules. For each OU, define the defaulting hierarchy for AP, PO, Projects, AR, and Expenses. Choose a tax classification code for each source, such as customer account, item. Classify: Inventory Items Parties, Party Sites Define Registrations for your Establishments and Third parties specific to Regime, tax, or jurisdictions: Avoid replication of customer or supplier sites Define Product categories Define Transaction business categories Use combinations of the above factors and more in rules instead of a single drop through hierarchy
  • <Course name> <Lesson number> - System Options for Tax Responsibility: Tax Managers Navigation: Tax Managers > Defaults and Controls > Configuration Owner Tax Options 11i Receivables System Options for Tax such as Rounding Options, Allow Overrides, etc. upgrade to Configuration Owner Tax Options and Tax Attributes Provides more granular control Enables the definition of different values for different taxes under the same OU
  • <Course name> <Lesson number> - Tax Groups Applicability of tax codes that are grouped under tax group code in 11i is upgraded by creating direct rate determination rules using condition based on the tax classification code that is same as tax group code 11i Tax Codes are upgraded as Tax Rates under the appropriate Tax Regime, Tax, and Tax Status 11i Tax Group Codes are not directly associated with tax rate %. They are used on taxable lines to indicate applicability of multiple tax rates for the given taxable line.
  • <Course name> <Lesson number> - Tax Jurisdiction Handling Responsibility: Tax Managers Navigation: Tax Configurations > Tax Jurisdiction In 11i, geography, tax jurisdiction, and jurisdiction rates information were coupled together as Location Values and Rates. The Sales Tax Key Flexfield was used for address validation but also to obtain Sales Tax Location tax rates. In 12, the upgrade process creates: Tax Zone Types based on 11i sales tax location structure and Geography types associated with the structure Data to allow tax zones to include geographies within country and specific geography types Tax Zones based on geography values for the geography type supported by the Zone Type. The geographies that form the tax zone are then specified, based on the geography types defined for the Tax Zone Type Inner City jurisdictions can be specified, and are usually based on tax zones formed by postal code ranges. This new model allows for definition of “true” jurisdictions. For example, in the US, there are more than 60,000 geographies, but only 7,000 jurisdictions. You can: Define multiple rates for a jurisdiction, for different statuses and rates Define zones for tax Define jurisdictions for zones Use zones for defining conditions, such as “Ship-to country in EU Zone”, etc.
  • <Course name> <Lesson number> - Tax Compounding In 11i, Tax Compounding is supported for O2C flow transactions by turning ON the flag at AR System Options. 11i Tax Groups in AR define the exact order of precedence in which taxes (codes) are calculated and compounded. In 12: From O2C tax codes/groups Regimes are upgraded to indicate cross Regime compounding. Compounding precedence is stamped at tax level during upgrade based on the O2C tax group level precedence.
  • <Course name> <Lesson number> - Tax Inclusiveness Responsibility: Tax Managers Navigation: Tax Configurations > Tax Jurisdiction > Set Invoice Values as Tax Inclusive checkbox The Customer and Customer Site Use level inclusive tax flag is maintained ‘as is’ and it is displayed in the context party tax profile that is equivalent to customer / Customer Site Use associated TCA Party / Party site. In 11i for AP transactions, support for Inclusive Tax computation is turned ON at System Options level. The Tax Inclusive flag is defined at the suppliers / sites level. The Inclusive flag from supplier / site level gets defaulted to taxable lines and all applicable taxes are considered inclusive / exclusive. In 11i for O2C transactions, each tax code carries inclusive flag. Additionally, the customer account / site uses also indicate whether taxes should be calculated inclusively. In 12: The Tax code level inclusive flag is upgraded to corresponding tax rate code and also taken to higher levels to Tax Regime, tax, and Tax Status. Taxes are upgraded as Inclusive / Exclusive based on P2P system option level indicator. Tax Rate Codes are upgraded as Inclusive / Exclusive based on O2C Tax Code level indicator. Tax inclusive is defined at Regime, Taxes and Tax Rates levels Standard Inclusive Handling, Special Inclusive Handling and Standard Non-Inclusive handling Tax Inclusiveness at Party / Party Site levels, in addition to account / site levels. Event Class options level define order in which parties / registrations need to be checked for inclusiveness
  • <Course name> <Lesson number> - Tax Recovery Responsibility: Payables and Receivables Navigation: Payables > Invoices : Entry > Invoices > (B) All Distributions > (B) Tax Distributions Navigation: Receivables > Transactions > Transactions > (B) Distributions Tax recovery is the partial or full reclaim of taxes paid on the purchase or movement of a product. In 11i, recoverable taxes are calculated using recovery rate % or rules specified at the tax code level In 11i, recovery rate % is either directly associated with tax codes as default rates or indirectly associated with tax codes using recovery rules 11i recovery determination applies one recovery % for each applicable tax. Since eBTax supports applicability of two recovery rates, the 11i recovery rate % is upgraded as recovery rate code for Primary recovery type and Secondary recovery type is kept null. In 11i, the Enable Recoverable flag and Default Recovery Rate are defined at Financials System Options. This definition is upgraded as Recovery Controls at the Regimes, Tax, Status and Rates levels Default Recovery Settlement can be defined at Tax, Status and Rates levels 11i recovery % is upgraded as % associated with recovery rate codes with ‘Standard’ Recovery Type. There are several recovery controls at the tax level. The 11i recovery rate % are upgraded for Primary Recovery Type. The default recovery % associated at the 11i tax code level is upgraded as default recovery rate code at tax and rate code levels In R12, you can: Optionally define a Secondary recovery type for a tax and create recovery rates under it Leverage Intended Use and other determining factors to define recovery rules, rather than using accounting based rules
  • <Course name> <Lesson number> - Tax Rounding Responsibility: Tax Managers Navigation: Parties > Party Tax Profiles In 11i for P2P transactions, Rounding Rule and Rounding Level are defined at Supplier and Supplier Site levels. In 11i for O2C transactions, Rounding Rule and Rounding Rule Override are defined at Receivables System Options, Customers and Customer Site Use levels. In R12: Rounding Rule and Rounding Level defined at Party Tax Profile for any 3rd party Rounding Rule and Rounding Rule Override defined at Regime and Tax levels, independent of product Configuration Owner Tax Options have 4 levels of rounding precedence to indicate the order in which party (ship from / ship to) level rounding options need to be evaluated. The Default Rounding Level can also be defined at the Configuration Owner Tax Option level.
  • <Course name> <Lesson number> - Tax Overrides Responsibility: Tax Manager Navigation: Defaults and Controls > Application Tax Options Receivables System Options level control for allowing customer exemptions override are upgraded to Applications Tax Options in the context of AR OU and receivables application. Override controls are specific to a configuration owner and event class. Overrides can be controlled at tax level, such as override for inclusive tax lines, tax rounding and for calculated tax lines Allow Tax Rate Override setup defined in Tax Codes is upgraded to Tax Status Allow Tax Rate Override is defined at the Status level Allow Tax Rounding Override defined in Receivables System Options, Customer and Customer Sites are upgraded to Party Tax Profile for first and third parties Allow Tax Rounding override can be defined at the Party Tax Profile level for any party Inclusive Tax Override flag at tax code level in 11i is upgraded to tax rate code, Tax Status, tax, and Tax Regime levels Override setup specific to a Configuration Owner and Application is defined at Configuration Owner Tax Options
  • <Course name> <Lesson number> - Offset Taxes Responsibility: Tax Manager Navigation: Defaults and Controls > Configuration Owner Tax Options Offset tax is a negative-rate tax used to fully or partially reduce another tax. ‘ Tax’ level indicator is upgraded from 11i, based on the associated offset tax rate codes The Configuration Option indicates which event classes allow offset taxes. The Party Tax Profile for the party indicated in offset tax base, carries the indicator from supplier/sites Taxes marked as “Set as Offset Tax” can be defined under the same Tax Regime where regular tax is defined A Tax can be defined normally under the same Regime where the offset tax is created. Either one can be defined first Any unassociated offset taxes are upgraded from 11i Applicable taxes for a Regime (whether regular or offset taxes) are identified
  • <Course name> <Lesson number> - Party Tax Attributes Responsibility: Tax Managers Navigation: Parties > Party Tax Profiles eBTax provides one single entity Party Tax Profile to hold party tax attributes. In R12, First Parties information such as LE and Establishment is also upgraded to TCA. Customer Account, Account Site, Site Uses, Suppliers, and Supplier Sites are associated with TCA Party / Party Sites. Tax attributes for third parties are either carried to party tax profile in the context of third party / third party site LE or displayed from the Party Tax Profile in the context of third party / third party site. All Party Tax attributes are upgraded as tax attributes belonging to Party Tax Profile or they are classifications / reporting codes of Party Tax Profile
  • <Course name> <Lesson number> - Tax Registrations Responsibility: Tax Managers Navigation: Parties > Party Tax Profiles Tax registrations: Are usually issued for a company or establishment, by a legal/tax authority, for an specific tax and within a certain tax jurisdiction Can be defined for 1st and 3rd parties. It is very important information since it can be used in tax rules and tax reporting Can be defined at Regime, tax or tax jurisdictions levels. Tax registration numbers are usually validated to ensure accuracy and/or comply with legal requirements. Single Tax Reporting Registration Number and Type can be defined at Party Tax Profile for Vendors and Vendor Sites for backward compatibility Single Tax Registration: Is defined at Customer and Customer Site Uses levels for backward compatibility Is defined at Party tax profile for Legal Establishments for backward compatibility You can define: Multiple registrations for the same party and different regimes, taxes, or jurisdictions As complete tax registration information as needed for each registration A user-definable registration status value Use the registration status value in tax rules such as Place of Supply rules, Tax Status rules, etc.
  • <Course name> <Lesson number> - Tax Exemptions Responsibility: Receivables Navigation: Transactions > Transactions > (T) Tax Exemption > (B) Lines 11i Exemptions definitions are upgraded to the newly defined Exemptions entity in Oracle E-Business Tax. Exemptions always apply to a Party and a Tax Regime. They can optionally apply to a Tax, Tax Jurisdiction, Tax Status and Tax Rate A tax Exemption usually has a certificate number, exemption reason, and status. It is created in the context of Party/Site. 11i Item exemptions without the context of Party are upgraded as Item Exceptions Exemptions are usually a discount or surcharge on the tax rate, but a special rate is also possible. Upgraded Exemptions are created with discount on tax rate The Allow Exemptions flag is defined at Configuration Owner Tax Options The Allow Tax Exemptions is defined at Regime and Tax levels Party Exemptions are defined in the Exemptions page flow for the Party Tax Profile Item Exceptions can be defined under Exceptions page flow, outside the realm of tax exemptions
  • <Course name> <Lesson number> - Tax Exceptions Responsibility: Tax Manager Navigation: Defaults and Controls > Configuration Owner Tax Options A tax exception is a special rate that applies to an item. A Tax exemption certificate is a document obtained from a tax authority which certifies that a party, party site, or product is either partially or fully exempt from a tax. Exceptions are defined for a Tax Regime and tax, for an specific product item or to a product classification. It can optionally apply to a Tax Jurisdiction, Tax Status, and Tax Rate. The Item Tax Rate Exception flag is obsolete in R12. The Allow Exemptions flag is defined at Configuration Owner Tax Options Item Exceptions are defined in the Exceptions page flow, under Products tab Item Exceptions apply to the Tax Regime and tax, for an specific product item or to a product classification. It can also apply to a tax jurisdiction, status and tax rate Item Exceptions can be defined under Exceptions page flow, outside the realm of tax exemptions Exceptions can apply to items or item classification
  • <Course name> <Lesson number> - Tax Formulas Responsibility: Tax Managers Navigation: Advanced Setup Options > Tax Formulas > (B) Create The Taxable basis formula created during the upgrade indicates the usage of quantity as a taxable basis instead of taking the line amount as the taxable basis. A tax formula is a special calculation not covered by the standard calculations available in the system. Examples of tax formulas are: To Calculate Taxable Basis To Calculate Complex Compounding Rules To Calculate Tax Amounts You can define several formula types, including taxable basis, calculate tax amounts, tax compounding formula, etc. In R12: PL/SQL formulas defined in previous releases are not upgraded to the new model The PL/SQL formulas defined in 11i are obsolete Formulas can be defined for Regime and Tax Certain rule types such as Taxable Basis and Tax Amount are based on tax formulas During Upgrade Tax formulas are created for applying discounts or to indicate compounding taxes.
  • <Course name> <Lesson number> - Global Descriptive Flexfields Tax related GDFs associated with first parties are upgraded as reporting codes with reporting type as GDF segment name and they are created in the context of upgrade LE / Establishment equivalent Party Tax Profile. Because the Latin Tax Engine still exists as a globalization solution, most of the LTE related GDFs are maintained ‘as is’. Transaction (Header / Lines / Distributions) level GDFs (including LTE related) are upgraded as named column in the context of the transaction (line / header / Distributions). Tax Line Level GDFs (including LTE related) are upgraded as named columns EMEA VAT reporting related GDFs that are meant to control preliminary / final reporting modes will be detailed in EMEA solution.
  • <Course name> <Lesson number> - Transaction Tax Upgrade For AP transactions, eBTax holds detail tax lines, summary tax lines and detail tax distributions in the context of AP transactions. For PO transactions, eBTax holds tax lines and tax distributions. In R12: There is one single repository with detail/fully allocated tax lines There is a Common Single repository for tax distributions in for procure to pay transactions There are document level summary tax lines for Payables transactions Tax line IDs/Tax Distribution IDs are stamped on AR/AP tax lines for reconciliation with product transactions Tax line IDs/Tax Distribution IDs from product transactions are carried to SLA for Accounting reconciliation Calculated taxes are propagated to documents created in downstream flow Effective variance calculations are performed for AP transactions Consistent validations and controls for overrides are enforced on tax lines and distributions
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  • <Course name> <Lesson number> - Content and Services Subscription Responsibility: Tax Managers Navigation: Provider Services > Service Mappings Navigation: Provider Services > Service Extensions Content Subscription Under Tax Regimes you can define the content subscription per tax regime, legal entity and operating unit. Services Subscription Tax services subscription can be configured under Services Mappings and Services Extensions flows
  • <Course name> <Lesson number> - Events and Configuration Owner Options Responsibility: Tax Manager Navigation: Tax Configuration > Tax Regimes You can now define whether a Legal Entity or an Operating Unit will become a “content owner” for a given Tax Content hierarchy and be responsible for defining and maintaining tax content separately. When it makes sense to share and maintain tax content centrally to streamline maintenance, tax content can be owned by a “Global Content Owner” and therefore be shared among specified legal entities and operating units. Configuration Owner Options: Hold tax configuration information for the configuration owner, application and tax event class. Upgraded data comes from: Financial System Options for Tax such as Rounding Rule, Precision, Minimum Accountable Unit, Default Tax Code, Default Recovery Rate, etc. AP System Options for Tax such as Enforce Tax from Account, Enforce Tax from Reference Document, etc. AR System Options for Tax such as Rounding Options, Allow Overrides, etc. Can be defined for a Legal Entity or Operating Unit in the Tax Regimes flow For Product Exceptions can be defined as Common or Party Specific For Taxes and Rules can be defined as Common, Common w/ Party Overrides and Party Specific Based on the Configuration Options for the Regime, the user must select the Configuration Owner, which can be ‘Global’ in case the configuration option is ‘Common’ or a party name, when the option is ‘Party Specific’
  • <Course name> <Lesson number> - Tax Jurisdictions Responsibility: Tax Manager Navigation: Tax Configuration > Tax Jurisdictions Geography information is now defined in TCA’s Geography Hierarchy model. Tax Jurisdictions are defined for taxes and geography information defined in TCA. Party locations are also based and validated against the same Geography information. Geography information, including geo-political geographies and user-defined geographies, is defined in TCA’s Geography model. Tax Jurisdictions are created for a geography type. Rates having different effective periods can be defined in the same flow, and multiple jurisdictions can be define for a tax, as well as a default one.
  • <Course name> <Lesson number> - Tax Rules Responsibility: Tax Manager Navigation: Tax Configuration > Tax Rules Both guided and expert configuration flows are available
  • <Course name> <Lesson number> - Fiscal Classifications: Product Responsibility: E-Business Tax Manager Navigation: Tax Managers > Product > Product Classification > (B) Create Several types of Product Fiscal Classifications can be defined for different purposes. Oracle E-Business Tax can link Fiscal Classification Types with existing inventory categorization or the user can create non-inventory classification types and codes. User can also define intended use classifications. Variety of Fiscal Classifications being modeled Product (classification of goods or services for tax purposes) Integrated with other classifications within Oracle E-Business Suite Inventory Category Set to model Product Fiscal Classification and Intended Use Defaults Fiscal Classification as a Tax Determining Factor An input that affects the outcome of a process. Tax determining factors are grouped into tax determining factor sets and they are used to define tax condition sets and tax rules.
  • <Course name> <Lesson number> - Fiscal Classifications: Party Responsibility: E-Business Tax Manager Navigation: Tax Managers > Parties > Party Classification > (B) Create Several types of Party Fiscal Classifications can be defined for different purposes. Oracle E-Business Tax can link Fiscal Classification Types with existing party categories in TCA and associate those with specific tax regimes. A party fiscal classification is linked to TCA’s party classification The codes belonging to the party classification are displayed in a tabular format Variety of Fiscal Classifications being modeled: Party (classification of parties for tax purposes). For example, SIC (Standard Industry Classification), NAICS (North American Industry Classification System), etc. Integrated with other classifications within Oracle E-Business Suite: TCA Party Classification to model Party Fiscal Classification Fiscal Classification as a Tax Determining Factor An input that affects the outcome of a process. Tax determining factors are grouped into tax determining factor sets and they are used to define tax condition sets and tax rules.
  • <Course name> <Lesson number> - Fiscal Classifications: Transaction Responsibility: E-Business Tax Manager (N) Tax Managers > Transactions > Transaction Fiscal Classification > (B) Create Several types of Transaction Fiscal Classifications can be defined for different purposes. Classifications such as Transaction Business Category can hold generic classifications whereas Document Type or User-Defined classifications can be very specific to a tax regime. Transaction Fiscal Classifications can have one or more levels and must be associated to a tax regime The classification codes are defined and displayed in a tabular format Variety of Fiscal Classifications being modeled: Classifications entered on Transaction Intended Use User Defined Transaction Business Category Derived from Transaction Business Category Fiscal Classification as a Tax Determining Factor An input that affects the outcome of a process. Tax determining factors are grouped into tax determining factor sets and they are used to define tax condition sets and tax rules.
  • <Course name> <Lesson number> - Tax Repository The tax repository is a single source of transactional tax information (tax lines) for all taxes calculated by E-Business Tax. It holds information about the calculated taxes, the parties involved, etc. The repository is used to support processes such as tax reporting, tax accounting and tax reconciliation. The repository is also the underlying infrastructure for users to see and/or modify (override) the tax lines. An invoice line can have one or more tax lines associated to it, where detailed information related to calculated taxes is captured
  • <Course name> <Lesson number> - Tax Simulator Responsibility: Oracle Tax Simulator Navigation: Oracle Tax Simulator > Tax Simulator Tax Simulator is a very powerful tool where users can simulate different types of transactions and immediately see the tax calculation results. This gives more flexibility and confidence to test new or changed tax rules. It gives flexibility to test new and/or changed tax rules Simulator has the relevant fields available in a transaction but with much less validations Once the transaction lines are entered and taxes get calculated, they can be seen in the tax lines summary page for each transaction line More detailed information can be seen for each tax line in the Detail Tax Line window All the rule types and rules that were invoked to generate each tax line can also be seen in the Rules window For each process, the corresponding conditions can also be seen Note: Tax Simulator emulates transactions, but does not trigger any real transactions
  • <Course name> <Lesson number> - Guided Configuration Rules belonging to multiple pre-defined rule types can be defined for a given tax Rules can be defined via guided (step by step) or expert (faster) flows Most rule types allow definition of default values, which get selected in case there are no rules defined for the rule type The rules defined for all rule types can be seen in a hierarchical fashion, turning maintenance easier and faster There are 5 general guided steps to define a tax rule: General Information: A rule is usually generic, but it can be defined as being specific to a transaction or geography as well. Rule Conditions: User selects the various determining factors and values that will form the rule conditions Rule Results: User then selects the rule result for the rule type in question and all previously selected rule conditions Rule Order: User then defines the order in which this rule will be evaluated for the rule type in question Rule Templates
  • <Course name> <Lesson number> - Profile Options for Tax Responsibility: System Administrator Navigation: System Administrator > Profile > System 11i Features carried into 12 include: Allow Ad Hoc Changes Allow Manual Tax Lines Allow Override of Customer Exemptions Allow Tax Classification Code Override Allow Tax Recovery Rate Override Inventory Item for Freight Invoice Freight as Revenue
  • <Course name> <Lesson number> - Upgrade Considerations 11i Tax Code/Name are used to name the R12 Tax, after removing any numeric portion (i.e. VAT10 => VAT) Tax Status for upgraded records are derived as “Standard” 11i Tax Code is used to name the R12 Tax Rate
  • <Course name> <Lesson number> -
  • <Course name> <Lesson number> -
  • Oracle R12 EBTAX [oraclefinancials.eu]

    1. 1. www.oraclefinancials.eu 4 Oracle E-Business Tax R12.x Oracle Financials New Features Fundamentals4-1 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    2. 2. www.oraclefinancials.eu ObjectivesAfter completing this module, you should be able to: • Describe and use the new features in Release 12 of Oracle E-Business Tax • Set up the new features in Release 12 of Oracle E-Business Tax4-2 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    3. 3. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4-3 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    4. 4. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4-4 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    5. 5. www.oraclefinancials.eu What is Oracle E-Business Tax (eBTax)Oracle E-Business Tax (eBTax) is a new product that: • Provides the infrastructure for tax knowledge management • Provides tax service to all E-Business Suite business flows • Uses a global system architecture • Is configurable and scalable • Is a single point solution • Is a one-application interface4-5 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    6. 6. www.oraclefinancials.eu QuizOracle E-Business Tax uniformly delivers tax services to all E-Business Suite business flows through one applicationinterface. a. True b. False4-6 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    7. 7. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4-7 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    8. 8. www.oraclefinancials.eu Business Requirements Met by eBTax • Sales and Use Tax in Procurement • Self-Assessed Tax in Payables • Multiple Registrations • Deferred Tax in AP • Enhanced Handling of Tax on Freight • Enhanced Exemptions and Exceptions • Multiple Inclusive, Compounding • Quantity Based Rates in Procurement4-8 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    9. 9. www.oraclefinancials.eu Business Needs Solutions Business Need Solution • Seeding of basic tax content setup for some countries • Service integration and data upload from Need for Automation Vertex and Taxware in the United States • Integrity checks when defining tax content setup • Most of tax content setup is date effective • Tax Rules flow makes it easy to change Constant Changes in Tax Laws and Regulations existing rules and/or create new ones • Tax Simulator allows simulation of tax setup, rules, transactions entry and respective tax rules results • Tax Registrations, Tax Reporting Codes • Tax Lines capture all relevant information Need for Local Compliance used to determine applicable taxes • Tax Reporting templates can be modified and extended4-9 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    10. 10. www.oraclefinancials.eu Business Needs Solutions Business Need Solution • Tax Lines capture all relevant information used to determine applicable taxes • Oracle E-Business Tax fully integrates and makes use of common infrastructure available within E-Business Suite such as: Information Fragmentation • TCA’s Geography Model • TCA’s Party Classification Model • Legal Entity Model • Inventory Item Categorization Model • Accounting Event Classes • Tax services for payments transactions can Deferred Tax in Payables be enabled at Configuration Owner Tax Options flow • Tax services for applicable transactions with Tax on Freight freight can be enabled at Configuration Owner Tax options flow4 - 10 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    11. 11. www.oraclefinancials.eu Business Needs Solutions Business Needs Solution • Complete Sales and Use Tax setup hierarchy can be defined in Regime to Rates flow • Tax services for applicable transactions can be enabled at Configuration Owner Tax Sales and Use Tax Options flow in Procurement • Tax rules can apply to generic or specific transactions • Tax Jurisdictions can be defined for very precise geographical areas where taxes are applicable • Tax setup allows creation of Quantity Based Duty Tax Handling tax rates Cash and Accrual Basis  Tax Lines will capture necessary information Reporting for Tax  Tax Reporting allows specific selection • Tax services for applicable transactions can Tax on Inter-company be enabled at Configuration Owner Tax Movements options flow4 - 11 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    12. 12. www.oraclefinancials.eu Business Needs Solutions Business Needs Solution • New Tax Registrations flow allows multiple tax Multiple Tax Registrations registrations for the same party and/or party site • Any number of Tax Reporting Types and Tax Reporting Codes Codes can be defined and associated to various entities within Oracle E-Business Tax4 - 12 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    13. 13. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4 - 13 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    14. 14. www.oraclefinancials.eu Key Concepts: Tax Authority Tax Authority: A government entity that regulates tax law, administers, and/or audits one or more taxes. Tax Tax Tax Regime Tax Authority Jurisdiction California State Board of Equalization HM Customs and Excise (U.K.) Canadian Customs and Revenue Agency (Canada) Secretaria da Receita Federal (Brazil)4 - 14 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    15. 15. www.oraclefinancials.eu Key Concepts: Tax Regime Tax Regime: The set of tax rules that determine the treatment of one or more taxes administered by a tax authority. Tax Tax Tax Regime Tax Authority Jurisdiction California State Board California Sales Tax of Equalization HM Customs and UK VAT Excise (U.K.) Canadian Customs and Canadian Goods and Revenue Agency Services Tax (Canada) Secretaria da Receita RICMS - Regulamento do Federal (Brazil) ICMS4 - 15 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    16. 16. www.oraclefinancials.eu Key Concepts: Tax Tax: A classification of a charge imposed by a government through a fiscal or tax authority. Tax Tax Tax Regime Tax Authority Jurisdiction California State Board California Sales Tax State Sales Tax of Equalization HM Customs and UK VAT UK VAT Excise (U.K.) Canadian Customs and Canadian Goods and GST Revenue Agency Services Tax (Canada) Secretaria da Receita RICMS - Regulamento do CMS Federal (Brazil) ICMS4 - 16 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    17. 17. www.oraclefinancials.eu Key Concepts: Tax Jurisdiction Tax Jurisdiction: A geographic area where a tax is levied by a specific tax authority. Tax Tax Tax Regime Tax Authority Jurisdiction California State Board California Sales Tax State Sales Tax California (State) of Equalization HM Customs and UK VAT UK VAT UK Excise (U.K.) Canadian Customs and Canadian Goods and GST Ontario Revenue Agency Services Tax (Canada) Secretaria da Receita RICMS - Regulamento do CMS São Paulo Federal (Brazil) ICMS4 - 17 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    18. 18. Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4 - 18 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    19. 19. www.oraclefinancials.eu Architecture Overview E-Business Suite Transaction Data Transaction Tax Data Oracle E-Business Tax Tax Services Request Manager Services Content Repository Tax Tax Tax Content Determination Administration Services Services Services Record Repository Partner Tax Partner Tax Content Services Interface Interface Tax Partner Tax Content Tax Services4 - 19 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    20. 20. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4 - 20 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    21. 21. www.oraclefinancials.eu Processing Taxes for Transactions Single Interface for Transactions Determine Applicable Purchasing Parties Regimes Taxes Places Products Receivables Calculate Tax Status Taxable Tax Processes & Rate Basis Amount Payables Transparent Integration with Tax Partner Services Sales Tax Taxes, … Transactions Rules4 - 21 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    22. 22. www.oraclefinancials.eu Tax Determination Services Example A default value or a rule indicates the Place of Supply Tax Regimes are identified based on the countries of the parties involved4 - 22 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    23. 23. www.oraclefinancials.eu Tax Determination Services Example Party classification can be used as a tax determining factor in any rule type A default party type value or a rule determines from which party to evaluate tax registration status4 - 23 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    24. 24. www.oraclefinancials.eu Tax Determination Services Example Product Classification (Qty * Unit Price) is can be used as a tax the default seeded determining factor in Taxable Basis any rule type formula, but other formulas can be defined4 - 24 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    25. 25. www.oraclefinancials.eu Tax Determination Services Example (Tax Rate * Taxable Basis) is the default seeded Tax Amount formula, but other formulas can also be defined4 - 25 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    26. 26. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4 - 26 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    27. 27. www.oraclefinancials.eu User Interface4 - 27 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    28. 28. www.oraclefinancials.eu Agenda • Oracle E-Business Tax (eBTax) Description • Business Needs that eBTax Meets • Key Concepts • Architecture • Process Flow • User Interface • Upgraded and New Features4 - 28 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    29. 29. www.oraclefinancials.eu Upgraded and Redesigned Features • Tax Definition Hierarchy • Tax Configuration Ownership • Tax Defaulting Hierarchy • System Options for Tax • Tax Groups • Tax Jurisdiction Handling • Tax Compounding • Tax Inclusiveness • Tax Recovery • Tax Rounding4 - 29 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    30. 30. www.oraclefinancials.eu Upgraded and Enhanced Features • Profile Options for Tax • Tax Overrides • Offset Taxes • Party Tax Attributes • Tax Registrations • Tax Exemptions • Tax Exceptions • Tax Formulas • Global Descriptive Flexfields (Tax Related) • Transaction Tax Upgrade4 - 30 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    31. 31. www.oraclefinancials.eu Tax Definition Hierarchy • Tax Setup “Backbone” • Also known as “Regimes to Rates” flow • Mainly comprised of Regime, Tax, Status and Rates, but also Tax Jurisdictions and Tax Recovery Rates • Parent-Child Relationships form a Hierarchy which is easy to visualize, navigate and maintain • Setup can normally be shared across all applicable applications, Legal Entities and Operating Units4 - 31 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    32. 32. www.oraclefinancials.eu Tax Configuration Ownership • 11i Tax Codes, Tax Groups, System Options and Defaulting Hierarchy are defined in the context of an Operating Unit with data replicated for different OUs • Though R12 target entities support data sharing across OUs, the upgrade process creates a tax setup in the context of Content Owner that is equivalent to OU. This ensures no data loss during upgrade. • Configuration Ownership is defined at the Tax Regime level and is a new feature offered in R124 - 32 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    33. 33. www.oraclefinancials.eu Tax Defaulting Hierarchy • 11i Tax Codes/Group codes that are used on taxable lines are upgraded as Tax Classification Codes lookups • 11i Tax Codes associated with defaulting hierarchy sources (Customers, Suppliers, Items, Accounts, etc.) are maintained as Tax Classification Codes • 11i Defaulting Hierarchies from AR/AP/PO/PA system options are upgraded as ‘Tax Classification Code’ defaulting hierarchy in Application Tax Options in the context of OU and application product (AR/AP/PO/PA).4 - 33 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    34. 34. www.oraclefinancials.eu System Options for Tax • 11i Financials System Options for Tax such as Rounding Rule, Precision, Minimum Accountable Unit, Default Tax Code, Default Recovery Rate, etc. are upgraded to Configuration Owner Tax Options and Tax Attributes • 11i Payables System Options for Tax such as Enforce Tax from Account, Enforce Tax from Reference Document, etc. also upgrade to Configuration Owner Tax Options and Tax Attributes4 - 34 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    35. 35. www.oraclefinancials.eu Tax Groups • Tax group codes are upgraded only as tax classification codes • 11i Tax Group Constraints are upgraded to Condition Sets • 11i Tax Codes Conditions and Exceptions are upgraded as Conditions and Exceptions at Process Results level4 - 35 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    36. 36. www.oraclefinancials.eu Tax Jurisdiction Handling • Location Values are upgraded to TCA’s Geography model as legislative geography elements (state/county / city/postal code) and Tax Zones (a combination of geographical elements) . • The upgrade process creates Tax Jurisdictions in the context of Tax Regime, Tax, and Tax Zone. • The upgrade process creates tax rates as Jurisdiction Rate Codes (codes associated with rate %) in the context of Regime, Tax, Tax Status, and Tax Jurisdiction.4 - 36 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    37. 37. Tax Compounding • For every tax code defined in AR, the upgrade process checks the compounding precedence defined for the tax code across different tax groups and assigns the compounding precedence to the corresponding Tax Regime and tax. • The upgrade process also defines the taxable basis formula to indicate which taxes are to be compounded. – For the taxable basis formula, the upgrade process creates taxable basis determination rules to indicate when such a formula is applicable4 - 37 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    38. 38. www.oraclefinancials.eu Tax Inclusiveness • The Upgrade process carries the AP system option level inclusive tax flag to each Tax under AP OU equivalent content owner to indicate whether tax support inclusiveness. • The Supplier level inclusive tax flag is upgraded to party tax profile in the context of ‘Third Party’ party type and Supplier associated TCA party. • The Supplier site level inclusive tax flag is maintained ‘as is’ and it is displayed in the context party tax profile that is equivalent to supplier associated TCA party site.4 - 38 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    39. 39. www.oraclefinancials.eu Tax Recovery • Recovery Rate % is upgraded to eBTax by creating Recovery Rate codes in the context of Tax Regime and tax that is associated with tax (rate) code to which recovery rate % is associated in 11i. • Recovery rate codes in eBTax also carry the context of recovery type. The upgrade process stamps recovery type as ‘Standard’ for each recovery rate code • 11i Recovery Rules are upgraded as Recovery rate determination rules indicating recovery rate code as result of the rule.4 - 39 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    40. 40. www.oraclefinancials.eu Tax Rounding • Rounding options in 11i are upgraded as rounding attributes for the Party Tax Profile associated to these 3rd parties • Rounding Rule and Allow Tax Rounding Override setup are available at Regime and Tax levels • Depending upon the event class, the rounding party hierarchy is stamped during the upgrade. The Default Rounding Level is also available at this level.4 - 40 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    41. 41. www.oraclefinancials.eu Tax Overrides • Responsibility Level Profile Options such as Allow Override of Customer Exemptions are maintained ‘as is,’ and Allow Override of Tax Codes are upgraded as Allow Override of Tax Classification Codes profile option • A new flag, “Allow Override of Inclusive Tax Lines” supported at Configuration Owner Tax Options level provides the choice to control the override for different event classes.4 - 41 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    42. 42. www.oraclefinancials.eu Offset Taxes • Both offset and regular tax codes are upgraded under the same Tax Regime but different taxes. – The offset flag is stamped for taxes that have offset rate codes upgraded from 11i. • The association of regular rate codes and offset rate codes is upgraded ‘as is’ to eBTax. • The offset functionality is offered only for backward compatibility purposes in R12. Oracle E-Business Tax offers a more complete functionality called Reverse Charge/Self-Assessment of taxes4 - 42 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    43. 43. www.oraclefinancials.eu Party Tax Attributes • Party Tax Profile records are upgraded for every TCA Party and Party Site. – Party Tax Profile records created during the upgrade hold tax attributes for first as well as third parties. • Tax attributes for first parties are carried to party tax profile in the context of LE or Establishment or they are stamped to each tax defined in the context of first party (OU) equivalent content owner4 - 43 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    44. 44. www.oraclefinancials.eu Multiple Tax Registrations • Tax Registration setup is upgraded as Default Registration Number and Default Registration Type for the Party Tax profile created for each correspondent party or party site • If different tax registration numbers are associated with HR Location / AR System Option / Financial System Option levels for the same first party: – The HR location level registration number is carried to ‘first party’ party tax profile – The other two registration numbers are carried as reporting codes of the ‘first party’ party tax profile.4 - 44 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    45. 45. www.oraclefinancials.eu Tax Exemptions • The Use Customer Exemptions flag is upgraded to Application Tax Options in the context of AR OU and receivables application. – The same flag value is also carried to each Tax, Tax Status, and Tax Rate code, providing more granular controls • In 11i, if higher (state) level exemptions were applicable for lower level (County / City) level taxes, then during upgrade, Tax Exemption Creation Method is appropriately stamped on lower level taxes at ‘Tax’ Level4 - 45 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    46. 46. www.oraclefinancials.eu Tax Exceptions • Tax Rate Exceptions are upgraded as Item Exceptions in R12. Exceptions UI flow is located under Products tab. • 11i Exemptions that are defined without the context of party (customer) are also upgraded as Item Exceptions in R12 • In most cases, a product item (or fiscal classification) will have a tax exception by having a special (differentiated) tax rate assigned to it4 - 46 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    47. 47. www.oraclefinancials.eu Tax Formulas • 11i tax codes that are defined with a Before/ After Discount/ Quantity taxable basis are upgraded to create a taxable basis formula. – The taxable basis formula is associated with tax rate codes as default taxable basis formula, overriding the standard line amount taxable basis indicated at corresponding tax level. • The Taxable basis formula created during the upgrade indicates that a discount needs to be applied prior to the tax amount computation.4 - 47 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    48. 48. www.oraclefinancials.eu Global Descriptive Flexfields • During upgrade, tax codes are upgraded as tax rate codes, and GDFs are considered for deriving values for the associated Tax Regime/Tax /Tax Status. • Tax code level GDFs that are used primarily for reporting are upgraded as reporting codes with reporting type as GDF segment name and they are created in the context of upgraded tax rate code. • Third party LE related tax GDFs such as tax payer ids from Third Parties (Suppliers / customers / TCA Parties) are maintained ‘as is’.4 - 48 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    49. 49. www.oraclefinancials.eu Transaction Tax Upgrade • Tax Lines in the context of AR transactions are upgraded to eBTax tax lines carrying AR transaction key • AP tax distributions are upgraded to eBTax with item distribution allocation information, detail and summary tax lines are also created during the upgrade • PO tax distributions are upgraded to eBTax with item distribution allocation information and detail tax lines are also created with shipment line allocation information4 - 49 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    50. 50. www.oraclefinancials.eu New Features • Content and Services Subscription • Events and Configuration Owner Options • Tax Jurisdictions • Tax Rules • Fiscal Classifications (Product, Party, Transactions) • Tax Repository • Tax Simulator • Guided Configuration4 - 50 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    51. 51. www.oraclefinancials.eu Content and Services Subscription • Regime Configuration Options allow the user to define for first party legal entities or Operating Unit: – Whether to centralize or decentralize the maintenance of tax content – Whether to subscribe to Oracle E-Business Tax services or to 3rd party tax vendors, per tax regime • Example: UK VAT calculated by Oracle E-Business Tax and US Sales tax calculated by Vertex.4 - 51 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    52. 52. www.oraclefinancials.eu Events and Configuration Owner Options • Defined at Tax Regime level • Defined for Legal Entities or Operating Units • Configurations Options are: – Common – Common with Party Overrides and – Party Specific • Common Configuration with Party Overrides is allowed for Tax and Rules but not for Product Exceptions4 - 52 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    53. 53. www.oraclefinancials.eu Tax Jurisdictions • Jurisdictions are defined for a given geography, regime, tax and tax authority (the latter is optional) • Tax jurisdictions can also be defined for areas inside city limits, which are usually indicated in the address • Tax Zones are defined in TCA’s model but via Oracle E- Business Tax menu option • Data upload routines used to upload US Sales Tax data from Vertex and Taxware populate data into both Geography Hierarchy and Tax Jurisdiction models4 - 53 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    54. 54. www.oraclefinancials.eu Tax Rules • Tax rules are a powerful and flexible mechanism used to meet tax legislation requirements • Tax rules are date effective • Rules are defined by Rule Types: – Direct Tax Rate Determination – Determine Place of Supply – Determine Tax Applicability – Determine Tax Status – Determine Tax Rate – Determine Taxable Basis – Calculate Tax Amount – Determine Recovery Rate4 - 54 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    55. 55. www.oraclefinancials.eu Fiscal Classifications: Product • Important tax determining factor for certain taxes • Product Classifications can be inventory linked or non- inventory linked • Inventory linked classifications are based on the Inventory’s Item Categorization model4 - 55 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    56. 56. www.oraclefinancials.eu Fiscal Classifications: Party • Important tax determining factor for certain taxes • Party Fiscal Classifications are fully integrated with TCA’s Party Classification model • The association between party classification codes and parties can be performed in TCA or using Oracle E- Business Tax’s Party Classification flows4 - 56 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    57. 57. www.oraclefinancials.eu Fiscal Classifications: Transaction • A classification usually defined by a tax authority, to categorize a transaction for a tax. There could be more than one by tax. • For example, for Brazil, three classifications are required: – Transaction nature, such as free sample, demonstration, consignment, donation; – Transaction classification, such as the sale of products previously acquired, the sale of products that have been manufactured by the company; and – Operation classification, such as ship from - ship to relationship, (e.g., intrastate sale).4 - 57 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    58. 58. www.oraclefinancials.eu Tax Repository • Single source of transactional tax information (tax lines) • Support for tax reporting, tax accounting and tax reconciliation processes • Underlying infrastructure for users to view and/or modify (override) tax lines4 - 58 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    59. 59. www.oraclefinancials.eu Tax Simulator • Tax Simulator helps on audit trail with respect to which Tax Rules were satisfied in calculating a particular Tax • Tax Simulator can act as a light-weight transaction for entering Purchase Orders, Invoices, Invoices matched against PO, etc.. that is integrated with Tax Lines User Interface • It is a fast way to enter transactions with fewer validations to perform what-if scenarios on tax calculation4 - 59 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    60. 60. www.oraclefinancials.eu Guided Configuration • Guides the user, step by step, during the configuration of the different types of tax rules available in the system. Users can also specify default values for most of those rule types • Makes it easy to select default values for most tax rule types • Generates all necessary setup behind the scenes4 - 60 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    61. 61. www.oraclefinancials.eu Profile Options for Tax • Profile options are similar to those in 11i, however, more granular control can be achieved – For example, a profile option can be set to “Allow Manual Tax Lines”. At the tax level, for a certain tax, manual creation can be disallowed. • There is a new profile option, “Read/write Access to Common Configuration data” provided to restrict access to persons creating or modifying installation-level configuration4 - 61 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    62. 62. www.oraclefinancials.eu Upgrade Considerations • 11i Tax Codes and Rates (AP Tax Codes and AR VAT Taxes) are upgraded as Regimes, Tax, Status and Rates • 11i Tax Codes are also upgraded as Tax Classification lookups • Tax Classification lookups are used in Direct Rate Determination Rules to reach the appropriate Tax Rate • 11i Tax Type, plus the country of the owning operating unit, are used to name the R12 Tax Regimes (I.e. UK VAT)4 - 62 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    63. 63. www.oraclefinancials.eu Implementation Information • Oracle E-Business Suite Release 12 Rapid Install is required for both new and upgrade customers. • Procurement Options: – Download from Oracle E-Delivery. – Purchase CD/DVDs on the Oracle Store. • Refer to Oracle MetaLink for: – Oracle Applications Release Notes – Installing Oracle Applications – Upgrading Oracle Applications • Oracle Applications Documentation is available through the Online Documentation CD and Oracle MetaLink.4 - 63 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
    64. 64. www.oraclefinancials.eu Summary In this module, you should have learned how to: • Describe and use the new features in Release 12 of Oracle E-Business Tax • Set up the new features in Release 12 of Oracle E-Business Tax4 - 64 Copyright © 2010, Oracle and/or its affiliates. All rights reserved.

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