VAT becomes chargeable when tax authorities have the right to claim payment. A chargeable event occurs when the conditions for VAT application are met, usually after a taxable transaction. However, it can also happen during or before the transaction, such as when an advance payment is received. Typically, VAT is paid when the return for the applicable period is filed.
To comply with the validations issued by the Polish tax authorities, companies must ensure that the tax fulfillment date and tax reporting date are included in all journal entries that involve tax items.
The tax fulfillment date refers to when the tax becomes chargeable, which occurs when goods or services are supplied. The tax reporting date is the deadline for reporting the tax to the authorities and is never earlier than the tax fulfillment date.
Since the tax fulfillment date is linked to the actual delivery date, companies may face difficulty accurately determining this date if it is not recorded in their system.
This tax rule applies to countries such as the Czech Republic, Hungary, Slovakia, and Spain. The KGT add-on supports transactions in such cases.
Additionally, there are concerns regarding transactions related to sent or received prepayments, postponed accounting, and recurring services. The KGT add-on can effectively manage these specific scenarios as well.
KGT has developed an SAP add-on that automatically applies the correct tax reporting date to specific business transactions with non-standard rules.
The first step involves KGT providing a mapping document that details the transactions that trigger tax reporting dates. It is essential to map the business flows related to these tax reporting requirements. Additionally, when designing practical rules for specific transactions based on historical data, it is important to highlight which rules should continue to be applied.
The solution is designed to work with tax codes; however, when a single tax code leads to multiple tax reporting dates, additional criteria must be used to differentiate these transactions. These could include document type, GL account, delivery terms, customer ID, or customer group. The solution is flexible, enabling us to establish specific conditions for where to search and what criteria should be combined.
Based on this mapping and design, KGT will configure the solution and conduct initial testing. Once successful, User Acceptance Testing (UAT) will begin. After resolving all issues, your IT department will transition the solution to the SAP production environment, where the correct tax reporting date will be automatically selected.
If you'd like to learn more, please don't hesitate to contact us. KGT will be happy to provide a demo using its own SAP environment.
KGT is a SAP partner for PE services and SAP Build partner, and to become an SAP partner, strict due diligence requirements must be met, including having certified SAP consultants. You can find us at: https://partnerfinder.sap.com/profile/0001925409
