Understanding Adjustments to VAT Base Prices

Use the Free Goods VAT Base Price program (P75C4106) to maintain item base prices that are used to calculate VAT on free goods. The system stores VAT on free goods in the F75C4106. The Free Goods VAT Base Price program is not used to adjust base prices on any items other than free goods. Alternatively, you use Advanced Pricing to generate free-goods line items automatically.

When you enter a sales order, the adjustment schedule sets the pricing unit of measure for the free goods line (UOM4) with the same transaction unit of measure that is defined in the free goods rules. When calculating VAT, the system first retrieves the price that is defined in the pricing unit of measure from the Sales Order Detail File table F4211. If the price is not defined for the pricing unit of measure, the system then retrieves the price by using the primary unit of measure.