Examples of Impact of Control Amount on Tax Calculations for Payables Transactions
The tax control amount is one of the key tax determinants available on the invoice header and lines that influences the calculated tax amount.
Use the tax control amount to match the total calculated tax amount on the invoice with the tax amount given on the supplier invoice. Oracle Fusion Tax adjusts the calculated taxes based on the specified tax control amount in proportion to the tax amounts determined for the applicable taxes.
For example, you have an invoice with two item lines, and taxes are applicable on both lines. All amounts are reflected in USD currency.
|
Description |
Line Tax Amount |
Total Tax Amount |
|---|---|---|
|
Total invoice tax amount |
600 |
|
|
Taxes applicable on Line-1:
|
|
400 |
|
Taxes applicable on Line-2:
|
|
200 |
The impact of the tax control amounts specified at the header and line levels is illustrated in the following scenarios.
Tax Control Amount Is Specified at the Header Level
The invoice header control amount is 400 USD. The impact is as follows:
|
Description |
Line Tax Amount |
Total Tax Amount |
|---|---|---|
|
Total invoice tax amount |
400 |
|
|
Taxes applicable on Line-1:
|
|
266.67 |
|
Taxes applicable on Line-2:
|
|
133.33 |
In this scenario, the line level total tax amounts are first adjusted in the proportion to their calculated tax amounts. For example, line 1 tax amount total is 400 USD which equates to 66.667% of the total tax amount (400/600 = 66.667%). The individual taxes for a line are then aligned with the line total amount in proportion to the calculated taxes. For example, line 1 adjusted tax amount is the header control amount of 400 USD multiplied by 66.667% (400 * 66.667% = 266.67).
Similarly, line 2 adjusted tax amount is 133.33 USD. The individual taxes involved are further apportioned in the ratio of their earlier tax amounts, for example, 75% and 25% (150/200 and 50/200, respectively).
Tax Control Amount Is Specified at the Header and Line Levels
The invoice header control amount is 400 USD and the Line-2 control amount is 100 USD. The impact is as follows:
|
Description |
Line Tax Amount |
Total Tax Amount |
|---|---|---|
|
Total invoice tax amount |
400 |
|
|
Taxes applicable on Line-1:
|
|
300 |
|
Taxes applicable on Line-2:
|
|
100 |
In this scenario, the line level total tax amounts are first adjusted based on the line control amount specified. The individual taxes for a line are then aligned with the line total amount in the proportion to their calculated taxes. For example, line 2 adjusted tax amount for Tax-A is the line 2 control amount of 100 USD multiplied by 150/200 (100 * 75% = 75).
Tax Control Amounts and Manual Tax Lines
You can manually enter additional tax lines with the calculated tax lines. The tax adjustments based on the given tax control amounts are then further influenced by the option Allow recalculation of manual tax lines set. You can find the option at the configuration owner tax options level.
Continuing with the previous example, the following scenario represents the tax control amounts specified at the header and line levels when the option for Allow recalculation of manual tax lines isn't selected. The invoice header control amount is 400 USD, the Line-2 control amount is 100 USD, and the manual tax inserted on Line-2 is 20 USD. The impact is as follows:
|
Description |
Line Tax Amount |
Total Tax Amount |
|---|---|---|
|
Total invoice tax amount |
400 |
|
|
Taxes applicable on Line-1:
|
|
300 |
|
Taxes applicable on Line-2:
|
|
100 |
In this scenario, the line level total tax amounts are first adjusted based on the header and line control amounts. The applicable line taxes are then aligned with the total line tax amount. Since the option for the recalculation of manual tax line isn't selected, the manual tax amount is retained. The other taxes are also adjusted toward the line control amount, in the proportion to their calculated tax amounts. For example, line 2 adjusted tax amount for Tax-A is the line 2 control amount of 100 USD less the manual tax amount of 20 USD multiplied by 150/200 ((100 - 20) * 75% = 60).
The following example represents the tax control amounts at the header and line levels. The option for Allow recalculation of manual tax lines is selected. The invoice header control amount is 400 USD, the Line-2 control amount is 100 USD, and the manual tax inserted on Line-2 is 20 USD. The impact is as follows:
|
Description |
Line Tax Amount |
Total Tax Amount |
|---|---|---|
|
Total invoice tax amount |
400 |
|
|
Taxes applicable on Line-1:
|
|
300 |
|
Taxes applicable on Line-2:
|
|
100 |
In this scenario, the line level total tax amounts are first adjusted based on the header and line control amounts. The applicable line taxes are then aligned with the total line tax amount. Since the option for recalculation of manual tax lines is selected, all the tax lines including the manual tax line get adjusted toward the line control amount, in the proportion to their tax amounts. For example, line 2 adjusted tax amount for Tax-A is the line 2 control amount of 100 USD multiplied by 150/220 (100 * 68% = 68).