Ebtax Impementation Guide
Ebtax Impementation Guide
Implementation Guide
Release 12.1
Part No. E13629-03
August 2010
Oracle E-Business Tax Implementation Guide, Release 12.1
Copyright © 2006, 2010, Oracle and/or its affiliates. All rights reserved.
Contributing Author: Nigel Chapman, Kevan Davies, Amit Jain, Robert MacIsaac, Amarnath Molugu,
Anand Naik, Angie Shahi, Harsh Takle, Brijesh Thakkar, Isaac William
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Contents
Preface
iii
3 Managing Migrated Data
Migrated Tax Data in Oracle E-Business Tax........................................................................... 3-1
Tax Classification Codes in Oracle E-Business Tax................................................................. 3-5
Tax Configuration Migration Path............................................................................................3-6
iv
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v
Preface
Intended Audience
Welcome to Release 12.1 of the Oracle E-Business Tax Implementation Guide.
This guide assumes you have a working knowledge of the following:
• The principles and customary practices of your business area.
If you have never used Oracle Applications, we suggest you attend one or more of the
Oracle Applications training classes available through Oracle University.
See Related Information Sources on page viii for more Oracle E-Business Suite product
information.
Documentation Accessibility
Our goal is to make Oracle products, services, and supporting documentation accessible
to all users, including users that are disabled. To that end, our documentation includes
features that make information available to users of assistive technology. This
documentation is available in HTML format, and contains markup to facilitate access by
the disabled community. Accessibility standards will continue to evolve over time, and
vii
Oracle is actively engaged with other market-leading technology vendors to address
technical obstacles so that our documentation can be accessible to all of our customers.
For more information, visit the Oracle Accessibility Program Web site at
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Structure
1 Understanding Oracle E-Business Tax
2 Setting Up Applications for Oracle E-Business Tax
3 Managing Migrated Data
4 Setting Up Country-Specific Taxes
A Troubleshooting Oracle E-Business Tax and Sample Scenarios
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• PDF - PDF documentation is available for download from the Oracle Technology
Network at http://otn.oracle.com/documentation.
• Online Help - Online help patches (HTML) are available on My Oracle Support.
Related Guides
You should have the following related books on hand. Depending on the requirements
of your particular installation, you may also need additional manuals or guides.
Oracle E-Business Suite Installation Guide: Using Rapid Install:
This book is intended for use by anyone who is responsible for installing or upgrading
Oracle Applications. It provides instructions for running Rapid Install either to carry
out a fresh installation of Oracle Applications Release 12, or as part of an upgrade from
Release 11i to Release 12. The book also describes the steps needed to install the
technology stack components only, for the special situations where this is applicable.
Oracle E-Business Suite Maintenance Procedures:
This guide describes how to use AD maintenance utilities to complete tasks such as
compiling invalid objects, managing parallel processing jobs, and maintaining snapshot
information. Part of Maintaining Oracle Applications, a 3-book set that also includes
Oracle Applications Patching Procedures and Oracle Applications Maintenance
Utilities.
Oracle E-Business Suite Maintenance Utilities:
This guide describes how to run utilities, such as AD Administration and AD
Controller, used to maintain the Oracle Applications file system and database. Outlines
the actions performed by these utilities, such as monitoring parallel processes,
generating Applications files, and maintaining Applications database entities. Part of
Maintaining Oracle Applications, a 3-book set that also includes Oracle Applications
Patching Procedures and Oracle Applications Maintenance Procedures.
Oracle E-Business Suite Patching Procedures:
This guide describes how to patch the Oracle Applications file system and database
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using AutoPatch, and how to use other patching-related tools like AD Merge Patch,
OAM Patch Wizard, and OAM Registered Flagged Files. Describes patch types and
structure, and outlines some of the most commonly used patching procedures. Part of
Maintaining Oracle Applications, a 3-book set that also includes Oracle Applications
Maintenance Utilities and Oracle Applications Maintenance Procedures.
Oracle E-Business Suite Upgrade Guide: Release 11i to Release 12:
This guide provides information for DBAs and Applications Specialists who are
responsible for upgrading a Release 11i Oracle Applications system (techstack and
products) to Release 12. In addition to information about applying the upgrade driver,
it outlines pre-upgrade steps and post-upgrade steps, and provides descriptions of
product-specific functional changes and suggestions for verifying the upgrade and
reducing downtime.
Oracle Alert User's Guide:
This guide explains how to define periodic and event alerts to monitor the status of
your Oracle Applications data.
Oracle Application Framework Developer's Guide:
This guide contains the coding standards followed by the Oracle Applications
development staff to produce applications built with Oracle Application Framework.
This guide is available in PDF format on My Oracle Support and as online
documentation in JDeveloper 10g with Oracle Application Extension.
Oracle Application Framework Personalization Guide:
This guide covers the design-time and run-time aspects of personalizing applications
built with Oracle Application Framework.
Oracle E-Business Suite Concepts:
This book is intended for all those planning to deploy Oracle E-Business Suite Release
12, or contemplating significant changes to a configuration. After describing the Oracle
Applications architecture and technology stack, it focuses on strategic topics, giving a
broad outline of the actions needed to achieve a particular goal, plus the installation and
configuration choices that may be available.
Oracle E-Business Suite Developer's Guide:
This guide contains the coding standards followed by the Oracle Applications
development staff. It describes the Oracle Application Object Library components
needed to implement the Oracle Applications user interface described in the Oracle
Applications User Interface Standards for Forms-Based Products. It provides information to
help you build your custom Oracle Forms Developer forms so that they integrate with
Oracle Applications. In addition, this guide has information for customizations in
features such as concurrent programs, flexfields, messages, and logging.
Oracle E-Business Suite System Administrator's Guide Documentation Set:
This documentation set provides planning and reference information for the Oracle
Applications System Administrator. Oracle Applications System Administrator's Guide -
x
Configuration contains information on system configuration steps, including defining
concurrent programs and managers, enabling Oracle Applications Manager features,
and setting up printers and online help. Oracle E-Business Suite System Administrator's
Guide - Maintenance provides information for frequent tasks such as monitoring your
system with Oracle Applications Manager, administering Oracle E-Business Suite
Secure Enterprise Search, managing concurrent managers and reports, using diagnostic
utilities including logging, managing profile options, and using alerts. Oracle E-Business
Suite System Administrator's Guide - Security describes User Management, data security,
function security, auditing, and security configurations.
Oracle E-Business Suite User's Guide:
This guide explains how to navigate, enter data, query, and run reports using the user
interface (UI) of Oracle Applications. This guide also includes information on setting
user profiles, as well as running and reviewing concurrent requests.
Oracle E-Business Suite Multiple Organizations Implementation Guide:
This guide describes the multiple organizations concepts in Oracle Applications. It
describes in detail on setting up and working effectively with multiple organizations in
Oracle Applications.
Oracle Advanced Global Intercompany System User's Guide:
This guide describes the self service application pages available for Intercompany users.
It includes information on setting up intercompany, entering intercompany
transactions, importing transactions from external sources and generating reports.
Oracle Customer Data Librarian Implementation Guide:
This guide describes how to implement Oracle Customer Data Librarian. As part of
implementing Oracle Customer Data Librarian, you must also complete all the
implementation steps for Oracle Customers Online.
Oracle Customer Data Librarian User Guide:
This guide describes how to use Oracle Customer Data Librarian to establish and
maintain the quality of the Trading Community Architecture Registry, focusing on
consolidation, cleanliness, and completeness. Oracle Customer Data Librarian has all of
the features in Oracle Customers Online, and is also part of the Oracle Customer Data
Management product family.
Oracle Customers Online Implementation Guide:
This guide describes how to implement Oracle Customers Online.
Oracle Customers Online User Guide:
This guide describes how to use Oracle Customers Online to view, create, and maintain
your customer information. Oracle Customers Online is based on Oracle Trading
Community Architecture data model and functionality, and is also part of the Oracle
Customer Data Management product family.
Oracle E-Business Suite Diagnostics User's Guide
xi
This manual contains information on implementing, administering, and developing
diagnostics tests in the Oracle E-Business Suite Diagnostics framework.
Oracle E-Business Suite Integrated SOA Gateway User's Guide
This guide describes the high level service enablement process, explaining how users
can browse and view the integration interface definitions and services residing in
Oracle Integration Repository.
Oracle E-Business Suite Integrated SOA Gateway Implementation Guide
This guide explains how integration repository administrators can manage and
administer the service enablement process (based on the service-oriented architecture)
for both native packaged public integration interfaces and composite services (BPEL
type). It also describes how to invoke Web services from Oracle E-Business Suite by
employing the Oracle Workflow Business Event System; how to manage Web service
security; and how to monitor SOAP messages.
Oracle E-Business Suite Integrated SOA Gateway Developer's Guide
This guide describes how system integration developers can perform end-to-end service
integration activities. These include orchestrating discrete Web services into meaningful
end-to-end business processes using business process execution language (BPEL), and
deploying BPEL processes at run time.
It also explains in detail how to invoke Web services using the Service Invocation
Framework. This includes defining Web service invocation metadata, invoking Web
services, managing errors, and testing the Web service invocation.
Oracle E-Business Tax Reporting Guide:
This guide explains how to run all tax reports that make use of the E-Business Tax data
extract. This includes the Tax Reporting Ledger and other core tax reports,
country-specific VAT reports, and Latin Tax Engine reports.
Oracle E-Business Tax User Guide:
This guide describes the entire process of setting up and maintaining tax configuration
data, as well as applying tax data to the transaction line. It describes the entire
regime-to-rate setup flow of tax regimes, taxes, statuses, rates, recovery rates, tax
jurisdictions, and tax rules. It also describes setting up and maintaining tax reporting
codes, fiscal classifications, tax profiles, tax registrations, configuration options, and
third party service provider subscriptions. You also use this manual to maintain
migrated tax data for use with E-Business Tax.
Oracle E-Business Tax: Vertex Q-Series and Taxware Sales/Use Tax System
Implementation Guide:
This guide explains how to setup and use the services of third party tax service
providers for US Sales and Use tax. The tax service providers are Vertex Q-Series and
Taxware Sales/Use Tax System. When implemented, the Oracle E-Business Tax service
subscription calls one of these tax service providers to return a tax rate or amount
whenever US Sales and Use tax is calculated by the Oracle E-Business Tax tax engine.
xii
This guide provides setup steps, information about day-to-day business processes, and
a technical reference section.
Oracle Financials and Oracle Procurement Functional Upgrade Guide: Release 11i to
Release 12:
This guides provides detailed information about the functional impacts of upgrading
Oracle Financials and Oracle Procurement products from Release 11i to Release 12. This
guide supplements the Oracle E-Business Suite Upgrade Guide: Release 11i to Release 12.
Oracle Financials Concepts Guide:
This guide describes the fundamental concepts of Oracle Financials. The guide is
intended to introduce readers to the concepts used in the applications, and help them
compare their real world business, organization, and processes to those used in the
applications.
Oracle Financials Country-Specific Installation Supplement:
This guide provides general country information, such as responsibilities and report
security groups, as well as any post-install steps required by some countries.
Oracle Financials for the Americas User Guide:
This guide describes functionality developed to meet specific business practices in
countries belonging to the Americas region. Consult this user guide along with your
financial product user guides to effectively use Oracle Financials in your country.
Oracle Financials for Asia/Pacific User Guide:
This guide describes functionality developed to meet specific business practices in
countries belonging to the Asia/Pacific region. Consult this user guide along with your
financial product user guides to effectively use Oracle Financials in your country.
Oracle Financials for Europe User Guide:
This guide describes functionality developed to meet specific business practices in
countries belonging to the European region. Consult this user guide along with your
financial product user guides to effectively use Oracle Financials in your country.
Oracle Financials for India User Guide:
This guide provides information on how to use Oracle Financials for India. Use this
guide to learn how to create and maintain setup related to India taxes, defaulting and
calculation of taxes on transactions. This guide also includes information about
accounting and reporting of taxes related to India.
Oracle Financials for India Implementation Guide:
This guide provides information on how to implement Oracle Financials for India. Use
this guide to understand the implementation steps required for application use,
including how to set up taxes, tax defaulting hierarchies, set up different tax regimes,
organization and transactions.
Oracle Financials Glossary:
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The glossary includes definitions of common terms that are shared by all Oracle
Financials products. In some cases, there may be different definitions of the same term
for different Financials products. If you are unsure of the meaning of a term you see in
an Oracle Financials guide, please refer to the glossary for clarification. You can find the
glossary in the online help or in the Oracle Financials Implementation Guide.
Oracle Financials Implementation Guide:
This guide provides information on how to implement the Oracle Financials E-Business
Suite. It guides you through setting up your organizations, including legal entities, and
their accounting, using the Accounting Setup Manager. It covers intercompany
accounting and sequencing of accounting entries, and it provides examples.
Oracle Financials RXi Reports Administration Tool User Guide:
This guide describes how to use the RXi reports administration tool to design the
content and layout of RXi reports. RXi reports let you order, edit, and present report
information to better meet your company's reporting needs.
Oracle General Ledger Implementation Guide:
This guide provides information on how to implement Oracle General Ledger. Use this
guide to understand the implementation steps required for application use, including
how to set up Accounting Flexfields, Accounts, and Calendars.
Oracle General Ledger Reference Guide
This guide provides detailed information about setting up General Ledger Profile
Options and Applications Desktop Integrator (ADI) Profile Options.
Oracle General Ledger User's Guide:
This guide provides information on how to use Oracle General Ledger. Use this guide
to learn how to create and maintain ledgers, ledger currencies, budgets, and journal
entries. This guide also includes information about running financial reports.
Oracle Internet Expenses Implementation and Administration Guide:
This book explains in detail how to configure Oracle Internet Expenses and describes its
integration with other applications in the E-Business Suite, such as Oracle Payables and
Oracle Projects. Use this guide to understand the implementation steps required for
application use, including how to set up policy and rate schedules, credit card policies,
audit automation, and the expenses spreadsheet. This guide also includes detailed
information about the client extensions that you can use to extend Oracle Internet
Expenses functionality.
Oracle Payables User Guide:
This guide describes how to use Oracle Payables to create invoices and make payments.
In addition, it describes how to enter and manage suppliers, import invoices using the
Payables open interface, manage purchase order and receipt matching, apply holds to
invoices, and validate invoices. It contains information on managing expense reporting,
procurement cards, and credit cards. This guide also explains the accounting for
Payables transactions.
xiv
Oracle Payables Implementation Guide:
This guide provides you with information on how to implement Oracle Payables. Use
this guide to understand the implementation steps required for how to set up suppliers,
payments, accounting, and tax.
Oracle Payables Reference Guide:
This guide provides you with detailed information about the Oracle Payables open
interfaces, such as the Invoice open interface, which lets you import invoices. It also
includes reference information on purchase order matching and purging purchasing
information.
Oracle Projects Documentation Set
Oracle Projects Implementation Guide:
Use this manual as a guide for implementing Oracle Projects. This manual also includes
appendixes covering security functions, menus and responsibilities, and profile options.
Oracle Projects Fundamentals:
Oracle Project Fundamentals provides the common foundation shared across the Oracle
Projects products (Project Costing, Project Billing, Project Resource Management,
Project Management, and Project Portfolio Analysis). Use this guide to learn
fundamental information about the Oracle Projects solution. This guide includes a
Navigation Paths appendix. Use this appendix to find out how to access each window
in the Oracle Projects solution.
Oracle Project Costing User Guide:
Use this guide to learn detailed information about Oracle Project Costing. Oracle Project
Costing provides the tools for processing project expenditures, including calculating
their cost to each project and determining the GL accounts to which the costs are
posted.
Oracle Project Billing User Guide:
This guide shows you how to use Oracle Project Billing to define revenue and invoicing
rules for your projects, generate revenue, create invoices, and integrate with other
Oracle Applications to process revenue and invoices, process client invoicing, and
measure the profitability of your contract projects.
Oracle Project Management User Guide:
This guide shows you how to use Oracle Project Management to manage projects
through their lifecycles -- from planning, through execution, to completion.
Oracle Project Portfolio Analysis User Guide:
This guide contains the information you need to understand and use Oracle Project
Portfolio Analysis. It includes information about project portfolios, planning cycles, and
metrics for ranking and selecting projects for a project portfolio.
Oracle Project Resource Management User Guide:
xv
This guide provides you with information on how to use Oracle Project Resource
Management. It includes information about staffing, scheduling, and reporting on
project resources.
Oracle Projects Glossary:
This glossary provides definitions of terms that are shared by all Oracle Projects
applications. If you are unsure of the meaning of a term you see in an Oracle Projects
guide, please refer to the glossary for clarification. You can find the glossary in the
online help for Oracle Projects, and in the Oracle Projects Fundamentals book.
Oracle Purchasing User's Guide:
This guide describes how to create and approve purchasing documents, including
requisitions, different types of purchase orders, quotations, RFQs, and receipts. This
guide also describes how to manage your supply base through agreements, sourcing
rules, and approved supplier lists. In addition, this guide explains how you can
automatically create purchasing documents based on business rules through integration
with Oracle Workflow technology, which automates many of the key procurement
processes.
Oracle Receivables Implementation Guide:
This guide provides you with information on how to implement Oracle Receivables.
Use this guide to understand the implementation steps required for application use,
including how to set up customers, transactions, receipts, accounting, tax, and
collections. This guide also includes a comprehensive list of profile options that you can
set to customize application behavior.
Oracle Receivables Reference Guide:
This guide provides you with detailed information about all public application
programming interfaces (APIs) that you can use to extend Oracle Receivables
functionality. This guide also describes the Oracle Receivables open interfaces, such as
AutoLockbox which lets you create and apply receipts and AutoInvoice which you can
use to import and validate transactions from other systems. Archiving and purging
Receivables data is also discussed in this guide.
Oracle Receivables User Guide:
This guide provides you with information on how to use Oracle Receivables. Use this
guide to learn how to create and maintain transactions and bills receivable, enter and
apply receipts, enter customer information, and manage revenue. This guide also
includes information about accounting in Receivables. Use the Standard Navigation
Paths appendix to find out how to access each Receivables window.
Oracle Subledger Accounting Implementation Guide:
This guide provides setup information for Oracle Subledger Accounting features,
including the Accounting Methods Builder. You can use the Accounting Methods
Builder to create and modify the setup for subledger journal lines and application
accounting definitions for Oracle subledger applications. This guide also discusses the
reports available in Oracle Subledger Accounting and describes how to inquire on
xvi
subledger journal entries.
Oracle Trading Community Architecture Administration Guide:
This guide describes how to administer and implement Oracle Trading Community
Architecture (TCA). You set up, control, and manage functionality that affects data in
the TCA Registry. It also describes how to set up and use Resource Manager to manage
resources.
Oracle Trading Community Architecture Technical Implementation Guide:
This guide explains how to use the public Oracle Trading Community Architecture
application programming interfaces (APIs) and develop callouts based on Oracle
Workflow Business Events System (BES). For each API, this guide provides a
description of the API, the PL/SQL procedure, and the Java method, as well as a table of
the parameter descriptions and validations. For each BES callout, this guide provides
the name of the logical entity, its description, and the ID parameter name. Also
included are setup instructions and sample code.
Oracle Trading Community Architecture Reference Guide:
This guide contains seeded relationship types, seeded Data Quality Management data,
D and B data elements, Bulk Import interface table fields and validations, and a
comprehensive glossary. This guide supplements the documentation for Oracle Trading
Community Architecture and all products in the Oracle Customer Data Management
family.
Oracle Trading Community Architecture User Guide:
This guide describes the Oracle Trading Community Architecture (TCA) and how to
use features from the Trading Community Manager responsibility to create, update,
enrich, and cleanse the data in the TCA Registry. It also describes how to use Resource
Manager to define and manage resources.
Integration Repository
The Oracle Integration Repository is a compilation of information about the service
endpoints exposed by the Oracle E-Business Suite of applications. It provides a
complete catalog of Oracle E-Business Suite's business service interfaces. The tool lets
users easily discover and deploy the appropriate business service interface for
integration with any system, application, or business partner.
The Oracle Integration Repository is shipped as part of the E-Business Suite. As your
instance is patched, the repository is automatically updated with content appropriate
for the precise revisions of interfaces in your environment.
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Oracle provides powerful tools you can use to create, store, change, retrieve, and
maintain information in an Oracle database. But if you use Oracle tools such as
SQL*Plus to modify Oracle E-Business Suite data, you risk destroying the integrity of
your data and you lose the ability to audit changes to your data.
Because Oracle E-Business Suite tables are interrelated, any change you make using an
Oracle E-Business Suite form can update many tables at once. But when you modify
Oracle E-Business Suite data using anything other than Oracle E-Business Suite, you
may change a row in one table without making corresponding changes in related tables.
If your tables get out of synchronization with each other, you risk retrieving erroneous
information and you risk unpredictable results throughout Oracle E-Business Suite.
When you use Oracle E-Business Suite to modify your data, Oracle E-Business Suite
automatically checks that your changes are valid. Oracle E-Business Suite also keeps
track of who changes information. If you enter information into database tables using
database tools, you may store invalid information. You also lose the ability to track who
has changed your information because SQL*Plus and other database tools do not keep a
record of changes.
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1
Understanding Oracle E-Business Tax
• Cross-border transactions.
• Continual changes to tax legislation, such as new taxes, local law changes, special
tax rates, and special exceptions for products and customers.
You can manage the entire configuration and maintenance of tax content from the one
E-Business Tax application. This ensures a uniform tax setup across applications, with a
centrally managed system of automated tax services and control over manual
intervention and update.
Tax Service Request Manager This component manages the access to all tax
data and services, including:
Tax Content Services and Tax Determination Services are the key components in the
• Tax jurisdictions
• Fiscal classifications
Basic Tax Configuration - The basic tax configuration includes the regime-to-rate flow
for each tax regime:
• Tax regime - The set of laws and regulations that determines the treatment of one
or more taxes.
• Tax status - The taxable nature of a product in the context of a transaction for a tax.
• Tax rates - The rates specified for a tax status for a given time period. The tax rate is
expressed as a percentage, a value per unit quantity, or a fixed sum per transaction.
• Tax recovery rates - The full or partial reclaim of taxes paid on the purchase or
movement of a product.
Tax Jurisdictions - This subcomponent provides the basis for defining tax jurisdictions.
A tax jurisdiction is the geographic area where a tax is levied by a specific tax authority.
Party Tax Profiles - This subcomponent provides the basis for defining tax profiles for
the parties involved in tax transactions that are set up through Legal Entity and Trading
Community Architecture. Party tax profiles contain all of the tax information for each
party, including tax registrations and party fiscal classifications.
E-Business Tax uses fiscal classifications to set up tax rules that provide one or more of
these qualifications:
• When taxes apply.
Exemptions and Exceptions - Tax exemptions let you define a party/party site or product
as partially or fully exempt from a tax. The details of tax exemptions are normally
supported by tax exemption certificates from the tax authority. Tax exceptions let you
define a special rate for specific products. This lets you define general rules for a wide
classification of products, while applying a separate rule to a subset of products.
Country Default Controls - This subcomponent lets you specify certain defaults by
country. These defaults are used during transaction entry.
• Rule processes
• Process results
• A tax rule makes use of a tax determining factor set. The determining factor set
contains the list of determining factors that you draw from to create the tax rule.
• The tax rule is composed of tax condition sets. You create tax condition sets for the
tax rule, using the determining factors of the determining factor set.
• Each tax condition set within a tax rule is associated with a result and assigned a
priority in which the rule engine considers the tax condition.
• Each tax rule within a rule process is assigned a priority in which the rule engine
considers the rule.
• At transaction time, the rule engine examines each tax condition until it finds a
result that makes the rule true and applicable to the transaction. If no tax condition
is found, then the rule does not apply to the transaction. The rule engine looks to
the tax rule with the next highest priority and repeats the process until a tax rule is
found.
• Determine Tax Registration - Determines the tax registration status for the
applicable taxes of the parties involved in the transaction.
• Determine Tax Status - Determines the tax status of each applicable tax to use on
the transaction.
• Determine Tax Rate - Determines the tax rate for each applicable tax status to use
on the transaction.
• Calculate Tax Amounts - Calculates the tax and displays the calculation results.
Depending on the complexity of the tax rules in a tax regime, you may or may not
define a tax rule for each of the above processes. If there is no complex rule associated
with any of the above processes, then the default values, as specified during setup, are
used during the tax determination process.
Related Topics
Tax Rules in Oracle E-Business Tax, Oracle E-Business Tax User Guide
Who am I?
You first need to answer questions about yourself and your relationship to the legal and
regulatory agencies that enable you to operate in one or more countries.
Classification Level
• ... 3
• ... 1
• Domestic sales 2
• Interstate sale 3
• Intrastate sale 3
• Export sales 2
• ... 2
• ... 1
The top-level values of the structure ("Purchase" and "Sale") are seeded and correspond
to the high-level classification of transactions (also called "tax event classes"). You can
define up to five sub-levels of classifications under the top-level.
You can define rules for a transaction business category at any level that you need. For
example, in some cases it might be sufficient to distinguish between an export sale and
a domestic sale. In other cases, you may need to distinguish between an inter- and an
intra-state sale.
055 AUTOMOTIVE
ACCESSORIES FOR
AUTOMOBILES, BUSES,
TRUCKS
...
...
You can implement the above structure in Oracle Inventory using item categories.
Create a two-segment structure called "Main Category" and "Subcategory." For the
Main Category segment, define 055 and 070 as the list of choices; for the using the above
example, you can classify an item by associating the identifier 055.04 with it to indicate
that it belongs to the "Air Bags, Automotive" category. If an item is associated with a
category 055, it means that it belongs to the broader category of "Automotive
Accessories For Automobiles, Buses, Trucks." You can then use E-Business Tax to create
two product fiscal classification types, one to correspond to the Main Category and the
other the Subcategory. You can then define tax rules using one or both of these
classifications.
• Tax Administrator. Update and assign this responsibility to users who will provide
E-Business Tax technical setup and support services. You can update this
responsibility according to the duties of each tax administrator user.
• Oracle Tax Simulator. Assign this responsibility to users who test tax setups with
the Oracle Tax Simulator.
You can also set up new E-Business Tax menus and responsibilities according to your
requirements.
Related Topics
Responsibilities Window, Oracle Applications System Administrator's Guide – Security
Users Window, Oracle Applications System Administrator's Guide – Security
Menus Window, Oracle Applications System Administrator's Guide – Security
Data Access Sets, Oracle General Ledger Implementation Guide
• The User Access column indicates whether you can view or update the profile
option.
• View Only: You can view the profile option but cannot change it.
• Procurement - The user can either select another previously defined recovery rate
for the tax or enter a new recovery rate.
See: Setting Up Tax Recovery Rates, Oracle E-Business Tax User Guide for more
information.
• Freight for Intercompany - The freight Inventory item applies to internal Receivables
transactions only.
You must also set the eBTax: Invoice Freight as Revenue profile option to Yes.
Note: You may also need to set the OE: Item Validation Organization
profile option.
• Jurisdiction and Tax - Taxware calculates tax based on all jurisdiction information,
including ship-to, ship-from, point of order origin (POO), and point of order
acceptance (POA).
ZX_WEB_EXP_TAX_CLASSIFICATIONS
Use the ZX_WEB_EXP_TAX_CLASSIFICATIONS lookup type to create tax
classification codes for use in tax determination for transactions originating from
Internet Expenses.
ZX_EXEMPTION_REASON_CODE
Use the ZX_EXEMPTION_REASON_CODE lookup to create exemption reason lookup
code for use in tax exemptions. The exemption reason is a user-defined code that lets
you monitor the use of customer or product tax exemptions issued by the tax authority
and applied to specific transactions.
When you set up a tax exemption, you can use the exemption reason to identify the
reason for this exemption or to monitor a customer's application for an exemption. At
transaction time, E-Business Tax only considers certain tax exemptions if the exemption
reason and certificate number entered on the transaction line match the exemption
ZX_JEBE_VAT_TRANS_TYPE
Use the ZX_JEBE_VAT_TRANS_TYPE lookup type to create tax transaction types for
use with tax rate codes. You use transaction types when you set up a tax rate.
Tax rate transaction types represent local tax authority codes both for reporting
purposes and for controlling which rates appear on an invoice. See: Setting Up Tax
Rates, Oracle E-Business Tax User Guide for more information.
ZX_REGISTRATIONS_REASON
Use the ZX_REGISTRATIONS_REASON lookup type to create tax registration reason
codes. You use registration reason codes when you set up a tax registration to represent
the reason for the tax registration.
The tax registration reason code is for tax reporting purposes only. See: Setting Up a
Tax Registration, Oracle E-Business Tax User Guide for more information.
ZX_REGISTRATIONS_TYPE
Use the ZX_REGISTRATIONS_TYPE lookup type to create tax registration type codes.
You use tax registration type codes when you set up a tax registration to organize your
tax registrations into categories.
E-Business Tax provides these seeded tax registration types: CNPJ; CPF; CUIL; CUIT;
DNI; NIT; OTHERS; VAT. The tax registration types CPF, CNPJ, and OTHERS are used
in tax registration number validation for Brazil. All other seeded tax registration types,
and the tax registration types that you define, are for tax reporting purposes only.
See: Setting Up a Tax Registration, Oracle E-Business Tax User Guide for more
information.
ZX_REGISTRATION_STATUS
Use the ZX_REGISTRATION_STATUS lookup type to create tax registration status
codes. You use tax registration status codes as determining factors in tax rules.
E-Business Tax provides these seeded tax registration types:
See: Setting Up Tax Rules, Oracle E-Business Tax User Guide for more information.
ZX_TAX_TYPE_CATEGORY
Use the ZX_TAX_TYPE_CATEGORY lookup type to create tax types. You use tax types
when you set up a tax.
You can use tax types to classifies taxes for tax reporting purposes. See: Setting Up
Taxes, Oracle E-Business Tax User Guide for more information.
The ZX_TAX_TYPE_CATEGORY lookup type contained these seeded tax types:
You must set up and maintain the TCA geography hierarchy before you can perform
these tax-related setups:
• Legal entities and establishments - Enter and maintain location information for
first party legal entities and the first party legal establishments. See: Setting Up
Legal Entity, page 2-12 for more information.
• Tax zones - Set up tax zones to represent regions according to a tax requirement.
Tax zones let you group together regions otherwise separated by geographical or
political boundaries where a tax treatment is identical throughout these regions.
See: Setting Up Tax Zones, Oracle E-Business Tax User Guide for more information.
• Tax regimes - Set up tax regimes for a country or tax zone. See: Setting Up Tax
Regimes, Oracle E-Business Tax User Guide for more information.
• Taxes - Set up taxes and specify the geographical level where each tax applies, such
as a city tax or a county tax. See: Setting Up Taxes, Oracle E-Business Tax User Guide
for more information.
• Tax jurisdictions - Set up tax jurisdictions for a tax using geographies or tax zones.
See: Setting Up Tax Jurisdictions, Oracle E-Business Tax User Guide for more
information.
• Tax rules - Use the Geography determining factor class to set up determining factor
sets that use geographical locations in tax rules. Use the User Defined Geography
determining factor class to set up determining factor sets that use tax zones in tax
rules. See: Setting Up Tax Determining Factor Sets, Oracle E-Business Tax User Guide
for more information.
• Geography types - TCA provides seeded geography types for certain countries. The
geography types are used to create the geographical hierarchy of a country.
Perform these tasks for geography types:
• If necessary, set up new geography types in accordance with the structure of a
country.
Related Topics
Setting Up Real-Time Address Validation, Oracle Trading Community Architecture
Administration Guide
Administrating Geography Hierarchy, Oracle Trading Community Architecture
Administration Guide
Geography Name Referencing Process, Oracle Trading Community Architecture
Administration Guide
• First party legal establishments - The legal establishments that have or require tax
registrations, either implied or explicit, from one or more tax authorities.
• Legal authorities - The legal authorities that represent the tax authorities in the tax
regimes where you do business.
When you set up a legal entity or establishment, you can also set up party tax profile
details, including general information, rounding rule, and tax registrations. See: Party
Tax Profiles in Oracle E-Business Tax, Oracle E-Business Tax User Guide for more
information.
If you set up country default controls for the countries where you do business, then the
applicable tax regime and tax values default to the legal establishment tax registration
record. See: Setting Up Country Default Controls, Oracle E-Business Tax User Guide for
more information.
• Configuration owner tax options - Configuration owner tax options let you set
specific transaction tax processing and control options for a combination of
configuration owner and application event class. See: Setting Up Configuration
Owner Tax Options, Oracle E-Business Tax User Guide for more information.
When you set up legal entities for your company, set the Transacting Entity option to
Yes. See: Creating a Legal Entity, Oracle Financials Implementation Guide for more
information.
After you set up legal entities, set up the legal establishments that belong to the legal
entity.
• Tax registrations - Set up tax registrations for each legal establishment. Depending
on the applicable tax requirements, you may need to set up more than tax
registration for an establishment. You must complete additional setup in E-Business
Tax to set up a tax registration. See: Setting Up a Tax Registration, Oracle E-Business
Tax User Guide for more information.
Use the Associate Business Entities region to link a tax-related business entity to a legal
establishment. See: Creating Establishments, Oracle Financials Implementation Guide for
• Basic tax configuration - The collecting and reporting tax authorities appear in the
corresponding list of values on these tax configuration setups:
• Tax regimes
• Taxes
• Tax jurisdictions
• Tax registrations - Enter the tax authority responsible for issuing the legal
establishment tax registration number. Update the collecting and reporting tax
authorities that default from the tax jurisdiction record. See: Setting Up a Tax
Registration, Oracle E-Business Tax User Guide for more information.
• Tax exemptions - Enter the tax authority that issues the tax exemption certificate.
See: Setting Up Tax Exemptions, Oracle E-Business Tax User Guide for more
information.
When you set up a legal authority, set the Legislative Category to Transaction Tax. See:
Creating and Updating Legal Authorities, Oracle Financials Implementation Guide for
more information.
• Legal establishments - Apply an end date to the related tax reporting types, party
classifications, and tax registrations.
• Assign user to an E-Business Tax responsibility. See: Setting Up Tax Users, page 2-2
for more information.
• Assign operating units to the applicable primary ledgers. See: Setting Up Accounts
and Accounting Information, page 2-16.
You must set up and maintain operating units before you can perform these tax-related
setups:
• Party tax profiles - Set up a tax profile for each operating unit. The tax profile
indicates that the operating unit either uses the tax configuration of the legal entity
for transactions involving the legal entity and tax regime, or acts as a configuration
owner for the applicable tax regime. See: Setting Up an Operating Unit Tax Profile,
Oracle E-Business Tax User Guide for more information.
• Tax accounts - You can set up tax accounts for a single operating unit, or you can
share tax accounts across multiple operating units. The accounting segments
associated with the selected operating units are available for tax account purposes.
The calculated tax amounts post to the operating unit accounts that you define. See:
Setting Up Tax Accounts, Oracle E-Business Tax User Guide for more information.
• Configuration owner tax options - Set up configuration owner tax options for a
combination of operating unit configuration owner and application event class. The
configuration owner tax option settings let you modify the manner in which tax
data is configured. See: Setting Up Configuration Owner Tax Options, Oracle
E-Business Tax User Guide.
You can set up operating units using Oracle Human Resources, Oracle Inventory, or
Oracle General Ledger. The setup of operating units requires a number of prerequisite
setups. The number and kind of prerequisite setups depends upon your organization
Related Topics
Updating Establishments, Oracle Financials Implementation Guide
• Legal entity balancing segments - Define balancing segment values for the legal
entities involved in tax transactions.
• Accounting setup - Create an accounting setup for each legal entity with the ledger
or ledgers that you created, and assign the applicable operating units to the primary
ledger.
• Complete the accounting setup - Complete the details of the accounting setups.
Related Topics
Setting Up General Ledger, Oracle General Ledger Implementation Guide
Creating Accounting Setups, Oracle Financials Implementation Guide
• Party tax profiles - Assign party fiscal classifications to third party tax profiles to
use in tax determination for invoices associated with the party. See: Setting Up a
Third Party Tax Profile, Oracle E-Business Tax User Guide for more information.
• Tax rules - Use the Party Fiscal Classification determining factor class to set up
determining factor sets for use in tax rules. The Party Fiscal Classification
determining factor class uses the party fiscal classification type defined for a TCA
classification to identify the parties involved in a transaction. See: Setting Up Tax
Determining Factor Sets, Oracle E-Business Tax User Guide for more information.
Use TCA administration to set up and maintain classifications for use in party fiscal
classifications:
• Class category - Set up a class category to represent the party fiscal classification
type. These rules apply to enabling class category options for use with fiscal
classifications:
• Allow Multiple Parent Codes - You cannot enable this option. E-Business Tax
does not allow the class codes in a hierarchy to have multiple parents.
• Allow Parent Code Assignment - You can enable this option. E-Business Tax
lets you use the parent code to represent a class code within the hierarchy.
• Allow Multiple Class Code Assignments - You can enable this option.
E-Business Tax lets you assign more than one class code to the same entity
within the hierarchy.
• Class codes - Set up class codes under the class category to represent the detailed
classifications that belong to this class category. When you set up a party fiscal
classification using a TCA class category, the related class codes by default become
party fiscal classification codes.
Related Topics
Classifications Overview, Oracle Trading Community Architecture Administration Guide
Administering Classifications, Oracle Trading Community Architecture Administration
Guide
You complete this setup task flow for each Inventory-based product fiscal classification
type that you plan to define.
Related Topics
Defining Categories, Oracle Inventory User's Guide
Defining Category Sets, Oracle INventory User's Guide
The E-Business Tax solution for Release 11i migrated data includes these features:
• Migration of application-specific ownership of tax setup to the E-Business Tax
shared ownership model for all Procure-to-Pay and Order-to-Cash transactions.
• Migration of tax codes and rates (Payables tax codes and Receivables VAT taxes) to
the E-Business Tax Regime-to-Rate flow.
• Migration of existing tax codes and tax groups, and existing defaulting hierarchies,
to E-Business Tax as tax classification codes.
• Tax determination and tax calculation based on the tax classification code.
The Release 11i migration solution lets you begin using E-Business Tax according to
your existing tax setup with a minimum number of changes. This solution allows for a
gradual adaptation of the E-Business Tax setup and tax determination processes
according to your needs. Once you complete the transition to E-Business Tax processes,
you can disable the Release 11i migrated solution with no loss of service.
Transaction Handling
In Release 11i, Payables held summary tax distributions and allocations without
showing taxable amount details or tax line information. Procurement transactions did
not carry explicit tax lines and distributions, and every transaction query was a
recalculation.
In E-Business Tax, there are these improves to the management of transaction handling
and display:
• One single repository with detailed and fully-allocated tax lines.
• Common single repository for tax distributions for Procure to Pay transactions.
• Tax line and tax distribution IDs are stamped on Payables and Receivables tax lines
for reconciliation with product transactions.
• Tax line and tax distribution IDs from product transactions are carried to Subledger
Accounting for account reconciliation.
Note: Tax lines existing on an 11i item line, that are migrated to R12
will be recalculated, however, no new tax lines can be added to the 11i
migrated item lines.
Note: For the Latin Tax Engine, tax regime codes are created based on
the Tax Rule Set (global_attribute13) in AR_SYSTEM_PARAMETERS
and taxes are created based on Latin Tax Categories. If you are using
the Latin Tax Engine to calculate taxes, do not create new tax regimes
and taxes, but continue to use the Latin tax categories, tax codes, and
tax groups.
Tax code name Tax Code and Tax Rate Code (minus numeric
identifiers)
• Percentage rate
• Tax jurisdictions
• Tax rates
Related Topics
Oracle E-Business Tax, Oracle Financials and Oracle Procurement Functional Upgrade Guide:
Release 11i to Release 12
• Tax classification code assignments - E-Business Tax replaces the Release 11i tax
code assignments to products, parties, and application system options with tax
classification code assignments. You can update these tax classification code
assignments for the customers, suppliers, and other entities involved in your
transactions.
At transaction time, E-Business Tax uses the tax classification code that is defaulted to
the transaction line to determine the tax status and tax rate for applicable taxes. You can
also manually enter a tax classification code on the transaction line.
Related Topics
Setting Up Lookup Codes, page 2-8
Using Application Tax Options, Oracle E-Business Tax User Guide
Using Tax Classification Codes, Oracle E-Business Tax User Guide
Setting Up Tax Determining Factor Sets, Oracle E-Business Tax User Guide
• Use tax rules, for example, for status and rate determination and tax recovery.
• Create tax setup data under the Global Configuration Owner, to allow future
sharing of tax content.
As you become familiar with E-Business Tax setup tasks, you can create new tax data
directly in E-Business Tax, according to your requirements.
This table provides guidelines for using Release 11i tax data in E-Business Tax, and
indicates, where applicable, ways to increase your use of E-Business Tax features for
your tax determination needs.
• Use Recovery
Rules, if
applicable.
Tax Code Defaulting Define the defaulting Update/define the Replace the
Hierarchy hierarchy using defaulting hierarchy defaulting hierarchy
system options and using Application with tax rules for
select a tax code for Tax Options and specific tax
each source. select a tax regulations.
classification code for
each source.
• Tax jurisdictions
• Tax rates
• Compounded • Define
taxes upgraded multi-level
as taxable basis compounding or
formulae. surcharges in
combination with
base rate
modifiers.
• Enable/disable
cross-regime
compounding.
• Accounting-base
d recovery rules
upgraded as tax
rules for
recovery.
Tax Profile Options Set tax-related profile Set tax-related profile • Use the Tax and
options under options under Configuration
Payable, Receivables, E-Business Tax. Owner Tax
and Cash Options settings
Management. in conjunction
with profile
options for more
granular control.
• Responsibility
level: Allow
Override of
Customer
Exemptions and
Allow Override
of Tax Codes.
Tax Formulas Define PL/SQL for tax Define tax formulas Define several
codes, and only for for tax regimes, or tax formula types,
taxable basis regime and tax. including taxable
formulas. basis, calculate tax
amounts, and tax
compounding.
• Canadian Goods and Services Tax (GST) and Harmonized Sales Tax (HST)
These examples are intended to demonstrate typical setups, option settings, and
interdependencies for each tax regime. They are not intended to provide an example of
best practices in all cases. The actual details of your own tax configuration setup will
depend on your company's specific internal and legal tax requirements.
• Reduced rate of 5% for certain goods and services, such as domestic fuel and energy
saving materials.
• Zero rate.
Some goods and services are exempt from VAT. In addition, there is a zero rate for
Setup Features
This tax setup example is for a first party registered in the United Kingdom and dealing
with domestic, intra-EU and extra-EU transactions. Setup features include:
• There are five possible tax statuses for VAT: standard, reduced, exempt, zero, and
Intra-European Union zero. The Intra-European Union zero status came into effect
in 2000. There is a separate tax status record for each tax status. All records have the
same tax regime code, configuration owner, and tax, as well as the same default
controls.
Although you do not need to report exempt transactions, this example illustrates
the creation of a specific Exempt tax status (with associated zero rate) to allow
simple identification for reporting or audit purposes. The separate Intra-European
Union zero status also allows for easy identification and reporting.
• A company of this kind can normally recover 100%, with standard exceptions
where 0% recovery is permitted.
• The setup uses tax rules rather than tax exceptions to define exempt and reduced
rate goods.
• The setup uses tax rules rather than tax exemptions to define exempt customers,
such as diplomatic and military customers.
• The exchange rate type is User, to take into account the different options available to
the company for expressing foreign currency transactions.
Legal Authority
Field Value
City Southend-on-Sea
Status Active
Tax Authority
Field Value
Tax Zones
The tax zone type European Economic Regions contains a tax zone record for each country
in the European Union. The setup values are the same for each country, except for the
Geography Name field.
Field Value
Belgium
...
United Kingdom
Main Information
Controls
Defaults
Configuration
Options (if defined
from tax regime)
Tax Setup
Main Information
Controls
Tax Account
Controls
Tax Recovery
Controls
Main Information
Standard Status
Reduced Status
Exempt Status
Zero Status
Field Value
Tax GB VAT
Main Information
Standard Rate
Zero Rate
Main Information
Rate Period 1
Rate Period 2
Main Information
Configuration
Options (if defined
from party tax
profile)
Tax Registration
Source Explicit
GB VAT REGISTRATION
GB VAT Applicability
GB VAT Status
Tax Rules
These examples show the tax rules created for the tax GB VAT. The tax rules make use
of the tax determining factor sets and tax condition sets created for GB VAT. Refer to
these sets to understand their usage in each tax rule.
For each tax condition used in a tax rule, the rule result applies when its corresponding
tax condition is evaluated as true.
Tax Rule Code Effective From Condition Set Order Rule Result
Tax Rule Code Effective From Condition Set Order Rule Result
Tax Rule Code Effective From Condition Set Order Rule Result
Tax Rule Code Effective From Condition Set Order Rule Result
Tax Rule Code Effective From Condition Set Order Rule Result
• Zero-rated
Tax status is generally determined by product. For the consumer, there is no difference
between zero-rated and exempt goods and services: the consumer either pays tax or
not. Although GST and HST are not charged on zero-rated goods and services, the tax
registrant can claim input tax credits to recover the GST or HST paid or owed on
purchases and the expenses incurred to provide them.
The example in this section is based on the changes to GST and HST rates effective July
1, 2006.
Examples
This section provides four examples of Canadian tax setup:
• Ontario Example 1 - GST and PST are typically applicable on most goods and
services. In this example, a tax is not applicable on a transaction. Since you will
typically set the tax applicability of a tax to Applicable, you will need to define a tax
rule to identify when a transaction is not applicable.
• Ontario Example 2 - The taxable basis for tax calculation is typically (selling price) *
(tax rate). In this example, the taxable basis is reduced in Ontario for the purchase of
portable homes to be used for construction purposes.
• Quebec Example 1 - In Quebec, PST is calculated based on the selling price plus
GST.
• Quebec Example 2 - In Quebec, PST is applied on most goods and services. For
transactions relating to resale, you can fully recovery the PST.
Prerequisites
Before you can set up the E-Business Tax tax configuration for these examples, you may
need to complete one or more of these tasks:
• Set up the legal entity for your Canadian company.
• Set up legal authorities for Canada Revenue Agency, Ontario Ministry of Finance,
and the Ministere du Revenu du Quebec.
The CA GST HST regime has a compounding precedence of 1; the CA PST regime has a
compounding precedence of 2.
Main Information
Controls
Defaults
Configuration
Options (if defined
from tax regime)
Main Information
Controls
Defaults
Tax Registrations
Canada Registration
Ontario Registration
Quebec Registration
Tax Setup
Main Information
Compounding 1
Precedence
Controls
Tax Account
Controls
Tax Recovery
Controls
Main Information
Standard Status
Default Controls
Field Value
Tax CA GST
Geography Name ON
Field Value
Tax CA PST
Geography Name ON
Main Information
Standard Rate
Main Information
Tax Regime Code CA GST HST Tax Status Name CA GST Standard
Tax Regime Name CA GST HST Tax Rate Code CA GST STD RATE
Rate Period
Field Value
Tax CA PST
For Quebec Example 1, create a tax formula to represent that PST is calculated upon the
sale price plus GST.
Field Value
Tax CA PST
Field Value
Country Canada
If the values of this tax condition set are evaluated as true, then the result of the
Determine Tax Applicability rule is Not Applicable.
• CA
General
Goods
• CA
Portable
Homes
If the values of this tax condition set are evaluated as true, then the result of the
If the values of this tax condition set are evaluated as true, then the result of the
If the values of this tax condition set are evaluated as true, then the result of the
Determine Recovery Rate rule is the tax recovery rate CA PST STD REC RATE.
Setup Features
This tax setup example is for a first party registered in California and dealing with city,
county, state transactions. Setup features include:
• There are three taxes under the US Sales and Use tax regime, for city, county and
state sales.
• US Sales and Use tax is not recoverable, so the setup does not include recovery
rates.
• There are multiple tax jurisdictions at the city and county level.
Main Information
Tax Regime Code US SALES AND USE Country Name United States
Controls
Defaults
Configuration
Options (if defined
from tax regime)
Main Information
Configuration
Options (if defined
from party tax
profile)
Tax Registration
Tax Regime Code US SALES AND USE Tax Jurisdiction Code US CA STATE SALES
Source Explicit
Tax Setup
There are three taxes under the US SALES AND USE tax regime for city, county, and
state sales. The example below is for state sales. All setup values are the same for the
three taxes.
Main Information
Controls
Tax Account
Controls
Tax Recovery
Controls
Allow Primary No
Recovery Rate
Determination Rules
Main Information
Standard Status
Reduced Status
Zero Status
Field Value
Precedence Level 1
Main Information
Tax Regime Code US SALES AND USE Tax Status Name US State Sales
Standard
Tax Regime Name US Sales and Use Tax Rate Code US STATE SALES
STD RATE
Rate Period
2. This association can either be through the operating unit party tax profile or, if the
operating unit is set up to use the subscription of the legal entity, through the legal
entity party tax profile.
3. If the tax regime has content owned at the operating unit level and not the global
configuration owner level, the operating unit on the transaction must match the tax
regime setup.
Tax
The tax must be available for transactions and be within a valid date range for the tax.
2. Tax status must be set as the default tax status or have a tax status rule defined to
derive the tax status.
2. Tax rate must be defined as a child to the tax status derived in the prior section.
3. If the tax rate is associated to a jurisdiction, the place of supply specified in your tax
rule setup must match that of your transaction. For example, if the taxing
jurisdiction is British Columbia, Canada and your place of supply is ship-to, then
the ship-to address must be in British Columbia.
4. If the tax rate is associated to a jurisdiction, make sure the place of supply specified
in your tax rules, for example, ship-to is valid. Check the invoice and find the
address corresponding to your place of supply and identify the geography segment
in that address that you are using for your jurisdiction. Make certain a rate exists for
Note: If you exclusively use jurisdiction based rates, taxes will not
be applied if the place of supply is null. For this reason you should
use caution if you choose ship-from or ship-to as your place of
supply in receivables. If you do set these as the place of supply then
all invoices must have a warehouse or ship-to address depending
upon your setup. If your address is associated to a geography that
has not been properly defined in TCA, then you may also see the
following Receivables message: System cannot determine geographical
information for this location and cannot derive a tax jurisdiction.
Refer to Note 438718.1 to troubleshoot this scenario.
5. If the tax rate is not restricted to a jurisdiction, then a tax rate must exist with the
jurisdiction as null and the tax rate must be set up as default.
Tax Rules
1. When implementing E-Business Tax you must specify default rules before taxes can
be enabled. Ensure that the default for Determine Tax Applicability is set to
Applicable or that you have a rule defined and enabled that makes the tax
applicable for your specific transaction.
2. Ensure that the tax status and tax rate defaults are valid or that you have rules
defined to properly derive these values.
4. If you have defined tax rules using guided rule entry or expert rule entry, ensure
that the determining factor is available in the module where you are attempting to
calculate tax. Not all determining factors, condition sets and values can be used in
all modules.
Intercompany (AGIS)
Intercompany transactions presently do not pass a ship-to address. Ensure that your tax
rules for intercompany transactions are flexible enough to derive the proper tax rate
without reliance on ship-to.
Transaction
1. If your tax considers ship-from in receivables, specify a warehouse on your
transaction line. The same is true if you have advanced rules defined referencing
product fiscal classifications.
2. If you are using an upgrades setup, direct rate rule or if you configured rules to
3. Ensure the address on your transaction and for your legal entity and operating unit
are valid.
Additional Considerations
E-Business Tax has the flexibility to specify complex tax rules at many levels. Rules can
consider fiscal classifications set at the party or product level, transaction classifications
codes, and many additional factors.
The output created for this report is presented through the RXi tool. RXi allows you to
select the fields you wish to see, add summary columns, totals and breaks.
Additionally, you can select the output format (HTML, CSV, Text, and so on) when
running these reports. In most cases this data is used for data analysis as RXi (unlike
most other reports which use XML Publisher) does not have the formatting capabilities
to embed graphics such as a company logo or otherwise customize the presentation.
Data selected for viewing in this report uses the Tax Reporting Ledger or TRL engine to
gather data. This same engine is used across a wide number of other R12 E-Business Tax
reports.
• Oracle Payables
Important: Run this report from the forms UI to avoid receiving the
AR_SRS_LEDGER_FLEXFIELD has an incorrect validation type (P)
error, which occurs if it is run from the Web UI.
Responsibility: Tax Managers
(N) Requests > Other > Requests > Run
• TaxReg: The TAXREG attribute set can be used for Oracle Payables, Oracle
Receivables, and Oracle General Ledger, or all products. The report contains the
attributes most commonly included in Tax Registers. It does not include discount
amounts for Oracle Receivables and Oracle General Ledger.
Note: The reporting level selected changes the attributes that appear.
This means that distribution level attributes will not be displayed if the
report is submitted at the transaction level. Similarly, some transaction
level details are shown as null (blank) if the report is submitted at the
distribution level.
• HTML: This option produces output in an HTML table and is best viewed through
a browser. This is the recommended choice when exporting the Default attribute set
as the table has no limitations on the number of columns.
• TAB: A good alternative to CSV in cases where your content may include a comma,
for example, as in description or text fields.
• TEXT: Includes basic text output. This output format can be difficult to view as it
may result in large white spaces being produced on the page.
Note: If you are not using Multi-Org Access Control, the report ignores
the Reporting Level and Reporting Context parameters
• Legal Entity
• Operating Unit
Reporting Context
This LOV will render a list that is contextual to the reporting level selected, for example,
a list of operating units appears if you select Operating Unit.
Company Name
This parameter is available only when the reporting context is set as Ledger and is
populated by a list of Legal Entities for a given Ledger
• Interim Tax Register: Limits the output to Receivables transactions that are posted
to the interim tax account. A tax is posted to the interim account when the
settlement option for the tax rate is set to Deferred and the receivables invoice has
not yet been paid.
• Tax Register: Displays recoverable taxes, excludes any tax that is deferred (posted
to the Interim tax account).
Summary Level
Allows you to select the level of detail included in the report:
• Transaction Distribution Level
• Transaction Level
Note: Not all attributes specified in your attribute set will be displayed
at all summary levels. Distribution accounts for example are not
rendered on the output when the report is run at the Transaction level
nor are line-level attributes.
Transaction Parameters
Product Select the application to report on or select All to report on all applications.
• ALL
• Oracle Payables
• Oracle Receivables
• Not Transferred
• Transferred
Accounting Status
• Accounted
• Unaccounted
• Tax Regime Code: Select a tax regime to report on, or leave blank to report on all
applicable tax regimes
• Tax: Select a tax to report on, or leave blank to report on all applicable taxes.
• Tax Jurisdiction: Select a tax jurisdiction to report on, or leave blank to report on all
applicable tax regimes.
• Tax Status Code: Select a tax status to report on, or leave blank to report on all
applicable tax regimes.
• Tax Code Low/High: The range of applicable tax rate codes to include in the report
Note: The actual form does not designate these as Payables specific.
• Include Prepayments
Receivables Parameters
Standard Yes/No option. You must set to Yes to see on the report output.
• Include Invoices
• Include Applications
• Include Adjustments
• Payables Prepayments
Typically the wrapper code that invoked the TRL engine data extract will read the data
from these reporting tables and generate output. This output also can take many forms.
For the Financial Tax Register this is accomplished through the RXi solution. Other
reports leverage Oracle Reports to produce XML output and then utilize XML publisher
and a template (RTF) to format the output. Others use Java or the text style output
available in Oracle Reports.
3. After the spawned request is completed, the RXi publisher is invoked. This
publisher identifies the attribute set entered when the report was submitted and
uses the definition of the attribute set to select and summarize the fields to be
displayed. The data appears in the output format as specified.
• Note 973041.1, How To Configure The Financial Tax Register For Decimal Precision
5. Remove the columns that you desire (limit the columns to match the number
available in your version of your spreadsheet solution if choosing CSV output).
6. Select Tools > Security and add the responsibilities permitted to access the attribute
set.
7. Save.
Note: The attribute sets may only be visible from the forms based
request submission.
3. In the Report Name field enter RX-only: Financial Tax Register Report.
8. Select Currency Column. One more column is added that is Currency Column.
9. Navigate to any amount related field. For example, Taxable_amt in the Currency
Column select.
2. Ensure that tax debug logging is not turned on. See Note 417238.1, if you are unsure
of how this is checked.
3. Ensure you have the latest TRL code patches applied from Note 737320.1.
4. Schedule the request Purge Logs and Closed System Alerts to run regularly. This
will clear out the debug log tables and reduce the size of the tables read by the
report.
• ZX_REP_TRX_DETAIL_T
• ZX_REP_TRX_JX_EXT_T
• ZX_REP_ACTG_EXT_T
These tables store data only when debug is enabled. They can grow large over time
and periodically purging them ensures that the size of the table does not interfere
with the execution of individual reports. Data in these tables is stored by concurrent
request ID and is not used for any purpose except to generate output for individual
request submissions.
2. Transactions can be passed into the interface tables with a pre-calculated tax line.
Use the following query to find your versions of the preceding files:
select text
from all_source
where name in ('ARP_ETAX_UTIL', 'ARP_ETAX_AUTOINV_UTIL',
'ZX_PRODUCT_INTEGRATION_PKG', 'ZX_VALIDATE_API_PKG')
and text like '%$Header%'
and type = 'PACKAGE BODY';
Note: Tax Debug logs are not the same as AutoInvoice debug logs.
AutoInvoice will often return the following message in the log file
when E-Business tax fails: ERROR from eBusiness Tax - return code = 2
is a generic error handling message that is returned by the E-Business
Tax code to AR AutoInvoice whenever an error happens during tax
calculation. In order to troubleshoot this error a tax debug log is
Once created and exported to a text file or spreadsheet the log can be searched for error
strings. These can often be used in conjunction with the concurrent request log file and
exception report to keyword search and find known issues and fixes.
Check the Following List of Commonly Encountered Problems
• Note 603799.1, AR Reports and Vertex show Transaction Number As '~$~$$$'
• Note 745340.1, AutoInvoice Fails With Message "This Tax Rate Is Not Active"
• Note 786000.1, Credit Memo's fail with "System Cannot find tax Rate"
Intercompany Taxes
Release 12 includes the Advanced Global Intercompany Invoice feature. This provides a
responsibility that is used to generate intercompany invoices. Once generated in AGIS,
a workflow background process is run to create the invoice in the AutoInvoice interface
tables. AutoInvoice is then run to generate the invoice in Oracle Receivables.
In order to keep the taxes in sync between AR and AP, the workflow process that
populates the AP interface table does not start until the AR invoices are complete. Once
completed a business event triggers the relevant transactional data to be passed to the
AP interface tables including some of the tax attributes from the AR record. Although
some of these tax attributes stored on the AR transaction are referenced by the
workflow when the AP invoice is generated, the AP tax setup must be complete in
order for taxes to be in sync.
Note: Although the attributes are shared, AP code is separate from AR.
If you find that the AR and AP invoices are not in sync at the
completion of the processing, then you should contact the AP support
team to evaluate your tax setup and rules.
ORA-28115: The user was The solution for Receivables Note 751126.1
policy with attempting to this business Manager > lists additional
check option enter a tax line requirement is to Controls > causes for this
violation by clicking on manually add AutoInvoice > error message
FRM-40508:ORA the Tax button the tax Interface Lines >
CLE error: from the distribution line Query order >
unable to insert exceptions form. directly into the Click tax > Enter
record This is not the interface tables tax Line > Save
proper way to as discussed in
add tax lines to Note 731149.1
AutoInvoice. This can be done
Manual tax lines as part of your
can be added, customer
however the Tax interface from a
button is legacy
provided only to application
show calculated where taxes are
taxes on records calculated. Note
processed by the that this should
interface and not not be
to add tax lines. performed if you
are using Oracle
Order
Management.
OM will
calculate an
estimated tax
using the EBTax
engine and
AutoInvoice will
re-calculate the
tax at invoice
creation when
the tax liability is
incurred.
For more information, refer to Note 751126.1, Troubleshooting AutoInvoice Tax Issues with
R12 E-Business Tax (EBTax).
Important: The message number and message code are used in the code
to generate the message in a form or report. These are listed to assist
with debugging.
c) (N) Oracle
E-Business
Tax - Tax
Configuratio
n - Tax Rules
- Other
Dependent
Tax details
b) Oracle
E-Business
Tax - Tax
Status -
Check if the
transaction
date is
between the
Effective
From and
Effective To
date (if
specified).
426023 This Tax Rate The tax rate Ensure that Oracle Chapter 2 -
is not valid specified on the tax rate E-Business Basic Tax
ZX_TAX_RA for the an imported provided on Tax - Tax Configuratio
TE_NOT_EFF transaction tax line is not the imported Configuratio n - Setting up
ECTIVE date. valid in the tax line is n - Tax Rate Tax Rates.
context of the effective for and check the
transaction the Effective
date. transaction From and To
date. Users dates to
can create ensure that
new tax rates the provided
or for existing Tax rate is
tax rates they applicable on
can end date the
a rate transaction
percentage date. Users
and specify a can also
new create new
percentage Tax rates.
for the new
period.
426027 This Tax does The tax Ensure that Oracle Chapter 2 -
not exist. specified on tax specified E-Business Basic Tax
ZX_TAX_NO the imported on the Tax - Tax Configuratio
T_EXIST tax line does imported tax Configuratio n - Setting up
not exist. The line exists on n Tax - Check Taxes.
provided tax the the Effective
rate should transaction From and
be existing date. Effective To
for it to get date.
processed.
b) Enter
relevant place
of supply
field in the
transaction.
426040 This Tax Rate Based on the Ensure that Oracle Chapter 2 -
is not active. transaction the tax rate E-Business Basic Tax
ZX_TAX_RA information, code Tax - Tax Configuratio
TE_NOT_AC the applicable provided in Configuratio n - Setting up
TIVE tax could not the n - Tax Rate - Tax Rates.
be processed transaction is Check the
as the tax rate active as on Effective
is not active the From and
for the transaction Effective To
transaction/ date. Users dates and
tax can create ensure that
determinatio new tax rates the provided
n date. or can end Tax Rate is
Without an date an active on the
active tax existing rate transaction
rate, tax percentage date.
amount will and create
not be new one for
calculated. the new
period.
426041 A Party Tax The bill from Ensure that a Oracle Chapter 3 -
Profile does party party tax E-Business Managing
ZX_BILFRO not exist for provided in profile exists Tax - Party - Tax Profile
M_PARTY_N this Bill From the for the bill Party Tax
OT_EXIST Party. transaction from party Profile -
does not have provided in Check for
a party tax the Party Tax
profile. tax transaction. Profile for the
related Bill From
information Party.
related to
parties in the
transaction
are stored in
party tax
profile.
Without a
party tax
profile,
system is
unable to
determine the
tax
calculation
parameters
for that party.
b) Change the
Document
Sub Type
fiscal
classification
code on the
imported tax
line.
b) Change the
party fiscal
classification
code on the
imported tax
line.
b) During
import itself,
see what are
the
parameters
given for
inclusive tax
handling.
b) Oracle
E-Business
Tax - Tax
Configuratio
n - Recovery
Rate for
viewing
Recovery
Rate details.
3. Select tax reporting type in the Reporting Type Purpose drop down.
5. Enable the Reporting Type Use for Tax Rate. Any other reporting type use should
not be selected for Intra EU Transaction Type.
7. Regime and tax are not mandatory parameters. If entered, reporting codes are
specific to that regime and tax.
8. Enter appropriate tax reporting codes according to user requirements. These codes
are available as selection parameters for filtering transactions in the ESL report.
4. The Date Type Should Be Text and Define List of Reporting Codes check boxes are
automatically selected.
5. Regime and tax are not mandatory parameters. If entered, reporting codes are
specific to that regime and tax.
6. Reporting Type Use is automatically enabled only for Tax Rate. No other reporting
type use should be selected.
Associate Intra EU Transaction Type and Legal Justification Reporting Codes to Tax
Rate Code
1. (N) > Tax Configuration > Tax Rates.
2. Enter the appropriate regime, configuration owner, tax and status information.
3. Specify tax rate code and percentage rate as zero (existing/upgraded tax rate code
can also be updated).
4. (N) Rate Details > Tax Reporting Codes > Specify the Tax Reporting Type Code and
Reporting Codes created for Intra EU Transaction Type in the preceding example
(UK-INTRA-EU-SERVICES).
5. (N) Rate Details > Legal Justification Message Reporting Codes > Specify the Legal
Justification Reporting Type Code and Reporting Codes created in preceding
example ((UK-INTRA-EU-SERVICES).
6. Only one effective legal justification reporting type can be associated to a tax rate.
2. Specify the Tax Rate percent (19% or the applicable Tax Rate).
4. For the offset tax rate code specify the tax rate percent equal to negative of the
actual tax rate (-19% or the applicable tax rate).
5. When the applicable tax is calculated, the associated offset tax is automatically
calculated.
6. Alternatively, instead of offset tax, the self-assessed tax can be configured to create
a reverse charge on the Payables invoice line.
For additional details refer to Note 974979.1, EMEA VAT: Oracle Financials Release 12
Setups for 2010 EU VAT Package - Solution based on Tax Rates.