ONESOURCE Indirect Tax for SAP Goods Movement is meant to enhance SAP by providing missing tax integration functionality. The solution has been developed within the following parameters:

• Considers the goods movement location when calculating tax. The Ship From destination is used as the source location of the movement and the Ship To destination is the location to which the goods are moved. Both locations can be configured by the user.

• Solution applies to the U.S. tax process.• Implementation of ONESOURCE Indirect Tax for SAP Goods

Movement may require the company to re-evaluate the current taxability of purchases. Consider making purchases under a direct pay permit so that tax on goods movement will not lead to over-taxation.

• Only goods movement transactions related to processes using the MB1A transaction are covered.

INDIRECT TAX

ACCURATE TAX DETERMINATION FOR SAP GOODS MOVEMENTSREUTERS/Kham

Sometimes, companies may not know the future location or usage of goods at the time of purchase, or these details may change from the original assumptions. In these situations, the initial transaction tax paid or accrued at purchase may end up inaccurate. Tax changes due to such inventory or goods movements can be very challenging and time-consuming for companies to determine accurately and apply manually within their accounting systems. Auditors frequently look for goods movements as a common source of errors, and companies risk penalties due to non-compliance.

ONESOURCE Indirect Tax for SAP Goods Movement enables organizations using SAP to accurately and efficiently calculate, accrue, and record U.S. use tax on SAP internal goods movements within the Material Management (MM) module.

Goods MovementWith ONESOURCE Indirect Tax for SAP Goods Movement, the same highly accurate tax determination capability can be extended to post-purchase transaction activity in the U.S. Post-purchase goods movements may result in transaction tax liability based on a change in intended usage or location of a product. For example, a company may purchase inventory intended for use in production and eventual resale which does not trigger a sales–or use–tax liability. When the company later decides to move some of this inventory for internal consumption, this may trigger the need to calculate use tax for the product based on its final purpose and location.

This change in usage may be identified by one or more of the following:

• Transfer to a cost center• Transfer to a project• Transfer of stock to fixed asset• Stock scrapping

ONESOURCE Indirect Tax for SAP Goods MovementThe ONESOURCE Indirect Tax Integration for SAP Goods Movement provides a user interface and a process for properly identifying, and then posting, the correct tax. The tax is based on the characteristics of the goods movement activity. The Integration is an ABAP object-oriented program that can:

• Identifies specific goods movement transactions• Determines and calculates tax with the ONESOURCE Indirect Tax

determination engine• Posts journal entries in SAP to accrue estimated tax• Updates indirect tax determination database and the SAP

external tax tables• Displays the results in a custom SAP report

ONESOURCE INDIRECT TAX

Architecture & InstallationONESOURCE Indirect Tax Integration for SAP Good Movement is now a part of the Indirect Tax Suite of products that can be used for global tax calculation and compliance. With the 2.0.0.0 release it is now woven into the architecture and framework of the new Integration 6.x product using the new SOAP interface and uses many of the same tables and connection logic used in Integration 6.x. New tables are added that are specific to Goods Movement transaction selection logic and GM specific functions are available via a new Goods Movement menu within the ONESOURCE user menu. Key features such as the Flexible Field Mapping and the Address Mapper are now also part of the Goods Movement solution.

The installation of ONESOURCE Indirect Tax for SAP Goods Movement is accomplished through the use of an SAP-basis transport, enabling the installation to be completed in one step. The implementation of the ONESOURCE Indirect Tax integration for SAP is also very rapid and is described below.

ONESOURCE Indirect Tax Integration for SAPONESOURCE Indirect Tax integration for SAP is an important component of the overall solution for goods movement taxation. ONESOURCE Indirect Tax integration for SAP connects to the SAP Standard Tax Interface and passes specific, predefined transaction data from SAP to ONESOURCE. ONESOURCE Indirect Tax then determines and calculates all applicable transaction taxes, stores detailed tax and transaction information in its database, and returns the tax results back to the SAP Standard Tax Interface for placement in the appropriate SAP application.

The following diagram is an illustration of the important components of the ONESOURCE Indirect Tax for SAP Goods Movement solution. In addition to SAP and the SAP-provided RFCs and BAPI, the full solution requires both the ONESOURCE Indirect Tax determination engine and the SAP-certified ONESOURCE Indirect Tax integration for SAP.

ONESOURCE Indirect Tax Integration for SAPONESOURCE Indirect Tax Integration for SAP version 6 is global tax integration solution designed from the ground up with integration pointing into SAP ECC application modules as desired. It consists of a data collector, tax interface, and return process of tax results to the calling application with G/L integration in support of downstream SAP processes such as standard VAT reports and returns processing. It makes use of the SOAP (Simple Object Access Protocol) provided by SAP to communicate with ONESOURCE Indirect Tax Determination. The new Integration enables worldwide tax calculations, including VAT, US Sales and Use Tax, and other country-specific taxation.

Corporations using SAP as their Enterprise Resource Planning (ERP) system can simplify their worldwide Indirect Tax requirements by implementing ONESOURCE Indirect Tax Suite. The suite includes Determination, Integration for SAP, Reporting, and Compliance. The benefits provided by ONESOURCE Indirect Tax Suite are:

• Fast, accurate sales, use, consumer’s use tax, and VAT results• Monthly tax rate and rules updates for over 180 countries• Integrated tax calculation with SAP minimizing user decisions

and tax errors• Removal of the need to change SAP tax codes each time a rate/rule

changes, eliminating business interruptions, and running out of tax codes in SAP

• Complete audit database from which you can generate both standard and custom reports as well as returns

The following diagram is an illustration of the important components of the ONESOURCE Indirect Tax for SAP Goods Movement solution. In addition to SAP the full solution requires both the ONESOURCE Indirect Tax determination engine and the SAP ONESOURCE Indirect Tax integration for SAP.

ONESOURCE Indirect Tax for DeterminationONESOURCE Indirect Tax automatically determines tax based upon the attributes of a transaction, requiring no manual tax decisions during transaction processing. Our automatic tax determination capabilities deliver a level of tax accuracy by:

• Eliminating tax decisions by sales, purchasing, and accounting personnel

• Enabling the tax professional to administer company-specific tax configurations

• Providing tax data to the reporting database and associated reports

THE TOTAL SOLUTIONBy using ONESOURCE Indirect Tax for SAP Goods Movement, companies are able to extend the capabilities of their indirect tax determination engine while achieving a much finer level of accuracy in the determination of taxes for internal goods movements.

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