Tax Controls and Defaults

Set up details for the taxes of a tax regime. Each separate tax in a tax regime includes records for the statuses, rate, and rules that are used to calculate and report on the tax.

Oracle Fusion Tax derives defaults tax information from the tax regime to each tax that you create for a regime. You can modify this information at the tax level according to your needs, as well as add additional defaults and overrides.

Defining Controls and Defaults

The following table describes the defaults and controls available at the tax level.

Header Region

Field	Description	Default Derived from	Default Appears on	Controls
Enable tax for simulation	Controls whether this tax is available for computation within the Tax Simulator functionality	None	None	If selected, this tax is available for calculation in the Tax Simulator when the evaluate taxes is enabled for simulation.
Enable tax for transactions	Controls whether this tax is available for transactions. Selecting this option triggers integrity checks to validate that the setup for this tax is accurate and complete	None	None	If selected, this tax is used by transactions, if applicable. If not selected then this tax isn't processed as an applicable tax at transaction time.

Tax Information Region

Field	Description	Default Derived from	Default Appears on	Controls
Tax Currency	The default currency of the taxes within a tax regime	Tax regime	None	Defines the tax currency for calculation and reporting purposes
Minimal Accountable Unit	The minimal unit of currency reported to the tax authority. For example, 0.05 GBP indicates that 5 pence is the minimal unit	Tax regime	None	Defines the minimal accountable unit at transaction time
Tax Precision	A one digit whole number to indicate the decimal place for tax rounding	Tax regime	None	Defines the tax precision during tax calculation
Conversion Rate Type	The specific conversion rate table that's used to convert one currency into another. For example, the Association of British Travel Agents conversion rate used in the travel industry	Tax regime	None	Defines the conversion rate that's used as necessary at transaction time
Rounding Rule	The rule that defines how rounding is performed on a value. For example, up to the next highest value, down to the next lower value, or to the nearest value	Tax regime	None	Can control rounding at transaction time
Compounding Precedence	Defines the order in which this tax is calculated compared to other taxes that are compounded on or compounded by this tax. The tax with the lowest precedence value is calculated first.	None	None	Controls the order in which applicable taxes are calculated at transaction time
Reporting Tax Authority	The default tax authority to whom the tax reports are sent	Tax regime	Tax registration	None
Collecting Tax Authority	The default tax authority to whom the tax is remitted	Tax regime	Tax registration	None
Applied Amount Handling	Controls whether tax is recalculated or prorated on prepayment, with the default being Recalculated	None	None	Controls Oracle Fusion Payables functionality and how payments trigger recalculation or prorating of tax amounts
Set as offset tax	Defines this tax as an offset tax	None	None	Selecting this option disables the Controls region and Tax Exceptions and Exemptions Controls region and clears any values that were entered in these regions
Set tax for reporting purposes only	Defines whether this tax is set up for reporting purposes only	None	None	Controls whether this tax is used for reporting only and doesn't create any tax account entries

Controls and Defaults Tab, Controls Region

Field	Description	Default Derived from	Default Appears on	Controls
Tax Point Basis	Specify the event that's the basis for tax recovery or liability. This event is also the basis on which tax is considered for reporting.	None	Tax rate	Use this option in conjunction with the option on the first-party tax registration.
Tax Inclusion Method	Defines whether the tax is: Standard noninclusive handling: This option calculates the taxes as exclusive of the given transaction line amount Standard inclusive handling: This option calculates the taxes as inclusive of the given transaction line amount Special inclusive handling: This option calculates the taxes as inclusive of the given transaction line amount, but the calculation methodology differs from the standard inclusive process	None	None	Use this option in conjunction with other setup on tax, party tax profile, tax registration, and transaction details to control the inclusiveness of a line amount at transaction time
Allow override and entry of inclusive tax lines	Controls whether you can override and enter inclusive or exclusive line amounts	Tax regime	Tax rate	None
Allow tax rounding override	Allows the override of the rounding defined on the tax registration records	Tax regime	None	Use this option to override tax rounding setup on the tax registration records for registrations for this tax
Allow override of calculated tax lines	Allows you to override the calculated tax lines at transaction time when the Transaction Tax Line Override profile option is also set	None	None	Use this option in conjunction with the Transaction Tax Line Override profile option and the Allow override of calculated tax lines option for the configuration owner tax options to allow you to update calculated tax lines at transaction time. If any of these options aren't set then update of calculated tax lines isn't allowed at transaction time.
Allow entry of manual tax lines	Allows you to enter manual tax lines at transaction time	None	None	Use this option in conjunction with Allow entry of manual tax lines option for the configuration owner tax options. When both fields are set you can enter manual tax lines at transaction time.
Use legal registration number	Controls whether the tax registration number is the same as the legal registration number of the party	None	None	If this option is selected you can choose an existing legal entity registration number as the transaction tax registration number
Allow duplicate registration numbers	Controls whether you can enter duplicate tax registration numbers for different parties	None	None	If this option is selected you can enter duplicate tax registrations for different parties
Allow multiple jurisdictions	Controls whether you can enter multiple concurrent tax jurisdictions for this tax	None	None	If this option is selected you can create multiple concurrent tax jurisdictions for this tax
Allow mass creation of jurisdictions	Controls whether mass creation of jurisdictions functionality is allowed using the parent geography and geography setup for this tax	None	None	If this option is selected you can use the mass creation jurisdictions functionality for this tax

Tax Account Controls Region

Field	Description	Default Derived from	Default Appears on	Controls
Tax Accounts Creation Method	Controls whether the tax accounts used for this tax are derived from setup associated with this tax or copied from another tax defined by the Tax Accounts Source field	None	None	When the value is: Create tax accounts: Create tax accounts for this tax Use tax accounts from an existing tax: Enter the tax account source to be used at transaction time
Tax Accounts Source	Defines the tax to use to derive the tax accounts to use at transaction time	None	None	Use when the value in the Tax Accounts Creation Method field is Use tax accounts from an existing tax

Tax Exceptions and Exemptions Controls and Defaults Region

Field	Description	Default Derived from	Default Appears on	Controls
Allow tax exceptions	Controls whether tax exceptions are allowed for this tax	None	Tax status	None
Use tax exceptions from an existing tax	Controls whether tax exceptions are derived from this tax or derived from another tax as specified by the value in the Tax Exceptions Source field for the same transaction	None	None	Controls whether you can define tax exceptions for this tax or if they're derived from those defined against another tax related to the same tax line at transaction time
Tax Exceptions Source	Defines the tax to use as the source when theUse Tax Exception from an existing tax option is selected	None	None	Used in conjunction with the Use Tax Exception from an existing tax option and uses tax exceptions already created for customers for this tax
Allow tax exemptions	Controls whether tax exemptions are allowed for this tax	None	Tax status	None
Use tax exemptions from an existing tax	Controls whether tax exemptions are derived from this tax or derived from another tax as specified by the value in the Tax Exemptions Source field for the same transaction	None	None	Controls whether you can define tax exemptions for this tax or if they're derived from those defined against another tax related to the same tax line at transaction time
Tax Exemptions Source	Defines the tax to use as the source when the Use Tax Exemption from an existing tax option is selected	None	None	Used in conjunction with the Use tax exemptions from an existing tax option and uses tax exemptions already created for customers for this tax

Tax Recovery Controls and Defaults Region

Field	Description	Default Derived from	Default Appears on	Controls
Allow tax recovery	Controls whether this tax handles tax recovery	None	None	If this option is selected you can set up tax recovery for this tax