How Receivables Transaction Attributes are Used in the Tax Determination Process

Transaction header and transaction lines capture the information that's used to determine the taxes on a transaction line.

Attributes That Affect Tax Determination

The attributes influencing the tax calculation are:

• Transaction header attributes:

  • Transaction date

  • Legal entity

  • Business unit

  • Taxation country

  • Document fiscal classification

  • Ship-to customer

  • Ship-to customer site

  • Ship-to customer address

  • Bill-to customer

  • Bill-to customer site

  • Bill-to customer address

• Transaction line attributes:

  • Line amount

  • Quantity

  • Warehouse

  • Product fiscal classification

  • Product category

  • Product type

  • Tax classification code

  • Transaction business category

  • Intended use

  • User-defined fiscal classification

  • Exemption handling

  • Exemption certificate

  • Exemption reason

How Tax Is Determined

Oracle Fusion tax uses the transaction header and line attributes, in conjunction with the tax setup, to determine taxes applicable to your Receivable transaction lines. If your calculated tax amount is incorrect, check the values of transaction header and line attributes.

Your warehouse location, bill-to and ship-to address, product type, product fiscal classification, and intended use are most commonly used attributes in tax calculation. This is when you haven't configured the regime determination set as STCC (standard tax classification code) in the configuration owner tax options. If you have configured STCC as the regime determination set, check the value of the tax classification code on the transaction lines. If calculated taxes are still incorrect, there may be:

• Incorrect or missing association of product fiscal classification or intended use for the inventory item you entered on the transaction line

• Incorrect or missing party fiscal classification for customer party or party site

• A problem with the tax configuration