How Party Fiscal Classifications Work in Tax Rules and Tax Reporting

Party fiscal classification tax determination factors allow you to use party fiscal classifications in tax rules. A combination of determination factor class, class qualifier, and determining factor represent these determination factors.

In the tax rules setup, define the actual party to determine the relevant party fiscal classification by using a generic definition for class qualifier. You can also use party fiscal classifications for tax reporting.

Party Fiscal Classifications in Tax Rules

Depending on the transaction type, the following generic class qualifiers are defined as class qualifiers when using the party fiscal classification as a tax determining factor:

• Supplier bill-from party

• Bill-to party

• Ship-to party

• Ship-from party

• Point-of-acceptance party

• Point-of-origin party

Oracle Fusion Tax translates the generic parties into specific transaction parties as defined in the following table:

Generic Party	Order-to-Cash Party	Procure-to-Pay Party
Bill-from party	First-Party legal entity	Supplier
Bill-to party	Customer	First-Party legal entity
Ship-to party	Customer (ship to) party site	First-Party legal entity
Ship-from party	First-Party legal reporting unit	Supplier (ship from) party site
Point-of-acceptance party	Customer point of acceptance party	Not applicable
Point-of-origin party	Customer point of origin party	Not applicable

Tip: Always use the highest applicable level to define the party classification. For example, define the party fiscal classification at the customer or supplier level instead of defining the same classification on all the party sites for the customer and suppliers.

Tip: Party fiscal classifications are automatically derived during transaction time. Hence, you can use them as determining factors instead of process-based determining factors, which require manual entry for every transaction.

Party Fiscal Classifications in Tax Reporting

Use party classifications to classify parties for tax reporting purposes if specific party classifications need reporting. However, using tax reporting codes instead of party fiscal classifications offers a more flexible and less intrusive mechanism to support reporting without creating complexity in setup and maintenance.