local solutions. global success. sap supports ksa 2030...
TRANSCRIPT
SAP Supports KSA 2030 Vision Rolling out new Tax regimes
Local solutions. Global success.
Khaled Musilhy Director Globalization Services, SAP
April 30, 2018
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Legal Disclaimer
The information in this presentation is confidential and proprietary to SAP and may not be disclosed without the
permission of SAP. This presentation is not subject to your license agreement or any other service or subscription
agreement with SAP. SAP has no obligation to pursue any course of business outlined in this document or any
related presentation, or to develop or release any functionality mentioned therein. This document, or any related
presentation and SAP's strategy and possible future developments, products and or platforms directions and
functionality are all subject to change and may be changed by SAP at any time for any reason without notice. The
information in this document is not a commitment, promise or legal obligation to deliver any material, code or
functionality. This document is provided without a warranty of any kind, either express or implied, including but not
limited to, the implied warranties of merchantability, fitness for a particular purpose, or non-infringement. This
document is for informational purposes and may not be incorporated into a contract. SAP assumes no
responsibility for errors or omissions in this document, except if such damages were caused by SAP´s willful
misconduct or gross negligence.
All forward-looking statements are subject to various risks and uncertainties that could cause actual results to
differ materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates, and they should not be relied upon in making purchasing
decisions.
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3Internal
Agenda
Global changes in Tax domain
SAP Holistic Tax solution “end-to-end” supports KSA 2030 vision
Key messages
How? … SAP Globalization Services is the answer
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Tax is important topic, but has not been in focus in past
3rdlargest item of the working
capital is Indirect Tax
1in 8 business have global head
of VAT/GST having visibility
over returns prepared locally
over 160countries (except the US) will have
centrally administered indirect tax
systems. As competition for foreign
investment intensifies, many countries
are reducing their headline corporate tax
rates. To replace revenues from taxes
on profits, most countries are shifting
their reliance to taxes on consumption.
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Digitization of Tax Obligations Around the GlobeManual processes in disjoint systems are not possible anymore
Time
Risk:
Loss of Millions
Risk:
Reputation -
Personal and
Organizational
Risk:
Work Overload
Past:
Manual integration
possible
Risk:
Competitive
Disadvantage
Worldwide
tax changes
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Levels of Digital Compliance (according to E&Y)
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Current State of Digitalization across the Globe (acc. to E&Y)
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➢ A value-added tax (VAT) is a type of consumption tax that is placed on a product whenever value is added at a stage of production and at final sale.
➢ It differs from the sales tax in that taxes are applied to the difference between the seller-purchased price and the resale price. This is accomplished by taking full tax on all sales, but refunding the tax difference to the sellers.
➢ GCC countries agreed they will introduce VAT at a rate of 5%.
➢ The introduction of VAT represents a significant change in tax policy and will have a major impact on businesses across GCC.
➢ For KSA
➢ The VAT law has been released on July 28th, 2017
➢ The draft of the implementing regulations is released for public consolation till August 19th, 2017
➢ KSA and UAE went live with VAT in January 1st, 2018
New Tax regime in KSA ….VAT in KSA & GCC Market
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SAP Solutions for Global Tax ManagementIntroducing SAPs new Tax Portfolio
SAP solutions for tax management help
companies manage indirect tax consistently
and cost-effectively, enabling CFOs to adapt to
rapidly changing regulations around the world.
They do so by digitizing tax determination,
calculation, reporting and compliance, and by
integrating them with core business processes
on a global scale.
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SAP Solutions for Global Tax Management
AnalyticTransactional
Communication
to Authorities
Internal Controls
Tax Calculation
SAP Tax Service
▪ Minimize need for human
intervention
▪ Have accurate automatic tax
determination
▪ Automatic, non-disruptive
legal patches for 120
countries
Electronic Invoicing
SAP eDocuments, SAP NFE
▪ Comply with many local
regulations mandating the use
of electronic documents
▪ Simplify operations with one
user interface, pre-packaged
content and integration flows
Validation and Audit
SAP Tax Compliance
▪ Gain visibility of tax compliance
issues
▪ Automatically identifying wrong
tax data
▪ Automatically initiating correction
and documentation measures
Return Calculation and Declaration
SAP ACR, SAP TDF
▪ Manage statutory reporting
worldwide with unified user
experience
▪ Enable simple adoption of constant
legal reforms
▪ Supports different legal formats &
direct submission to authorities
HANASCP
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SAP end-to-end Solution for VAT in KSA
GRC - SAP Tax Compliance
Non SAP
ERP
Non SAP
Billing
System
SAP Data Migration Service
Baseline Package
ACRERP
Baseline Package
TA
X R
ep
ort
ing
TA
X C
om
pu
tati
on
Data
Readiness
Compliance
SAP Localization Hub
APIs or Microservices
SLH-ACR: Advanced Compliance Reporting TaaS: Tax service
SAP Cloud Platform
TaaSSLH-
ACR
VAT for T&E
Vat for procurement
Vat for BYD
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VAT Localization Country Template for S4HANA and ERP
1 Finance
➢ Tax Conditions Types
➢ SA Output VAT
➢ SA Input VAT
➢ Access Sequences (standard MWST)
➢ Tax Procedure (TAXSAN)
➢ Tax Codes (country specific)
➢ VAT 0%
➢ VAT 5%
➢ VAT Exempted
2 Sales Distribution
➢ Access Sequences (MWST)
➢ Departure Country / Destination Country
➢ Domestic Taxes
➢ Export Taxes
➢ Condition Type
➢ SA Output Excise Tax
➢ SA Output VAT
➢ Pricing procedure (RVAASA)
➢ Customer tax classifications
➢ Material tax classifications
3 Material Management
➢ Access Sequences 0003
➢ Domestic Taxes
➢ Export Taxes
➢ Set Tax Indicator for Material
➢ Set Tax Indicator for Plant
➢ Set Tax Indicator for Account Assignment
➢ Condition Type
➢ SA Input VAT
➢ Calculation Schema (RMSA00)
Country baseline packages for KSA via SAP Note 2477105
Minimum Pre-requisites :- ECC Customers: SW component SAP_APPL – release 605 and onward- S4 Customers: all releases of S4HANA - SW component S4CORE – release
100 and onward
2477105 - VAT implementation in Saudi Arabia
2456119 - VAT Baseline Package for UAE
Pilot SAP note GCC countries
2484173 - VAT Baseline Package for Oman
2502155 - VAT Baseline Package for Kuwait
2509484 - VAT Baseline Package for Bahrain
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Localization – present & future
Localization done as a part of
application codebase
Build once, run anywhere with the
service approach on SAP Cloud Platform
Tax
Service
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Tax computation Engine
Ship-From/Bill-From
Ship-To/Bill-To
Invoice
Tax
Configuration
Content
Tax Decision Tree
Processing using information entered in document
Tax Type
Tax Rate Type
Deductible Type
Tax Code
Tax Calculation
Tax Event Type
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Tax Service Benefits
Innovation
Scale flexibility
Gain speed to market
Compliance
Legal Change
updates
Automated
processes
Cost Savings
Less maintenance
effort
Infrastructure and
project savings
One tax calculation
engine
Consistent tax
computation results
Automation
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SAP Localization Hub, Tax Service – Global Coverage
Advanced
Basic
36
84
Total 120
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Process Requirements
eDocument Regulation
Build electronic file
e-Send to public authority
Process response
e-Send to receiver
Traditional Regulation
Print invoice
Send to customer
Outbound Invoice
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eDocument framework has been developed by SAP Globalization Services
▪ to comply with local regulations mandating the use of electronic documents to be sent to
business partners and/or legal authorities
Facilitates realization of different local requirements
▪ by leveraging their similarities
▪ ensuring high standards
▪ consistent user experience and lower operational cost
SAP eDocument Framework
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Integration Flows
Solution Landscape – eDocument Scenarios
SAP ERPSAP SCP,
integration serviceLocal Receiver
Web Service
SAP Netweaver 7.02
SAP APPL 6.00
Web Service
Country Format Mapping
Business Monitoring
Public Administration / Tax Authority
Communication
Authentication / Digital Signature
Validation
Approval / Registration
eDocument Framework
DocumentType 2
Country A
Country B
Document Type 1
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Suite
Recipient
Legal
Reports
Communication
PlatformSAP Cloud Platform Integration Digital Compliance Service 3rd Party
SAP ERP, option for e-document processing
Solution Architecture
SD Del GI SD Bill FI IS-U Real EstateMM returned
invoice
Chile Peru … Spain Netherlands Belgium Turkey
DTEPeruvian
UBL… Facturae EU-UBL UBL TR
SII SUNAT … FACeBusiness
PartnerTRA
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End-to-End VAT solution by SAP : Tax Reporting
Single framework
Unified Fiori Ux
Reporting dashboard
End-to-end reporting process
Self Service Configurations
Multiple legal formats
Data preview
Scheduling
Ad-hoc Reporting
Group Reporting
Electronic submission via HCI
Easier adoption of Legal changes
1
2
3
4
5
6
7
8
9
10
11
12
S/4 ACR and SLH ACR Main Features:
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End-to-End VAT solution by SAP : Tax Reporting
Cost Savings
Reduced TCO
Simplified implementation
with pre-packaged content
Auto Compliant
Constant adoption of
legal changes
Fiori Design
Harmonized User
Experience
User Friendly Innovation
Harnessing cloud
platform potential for
Next Generation Legal
Reporting
Advanced Compliance Reporting Service Benefits
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End-to-End VAT solution by SAP : Tax Reporting
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Examples – Risks and opportunities
VAT is not added to sales invoices if a customer is not VAT-registered or a valid domestic EU VAT number is not quoted on the invoice
Manual change of the VAT classification of the customer in the sales order
Manual change of the VAT classification of the products / services in the sales order
Cross border transactions where VAT is calculated but “Zero VAT” expected
VAT not charged on sales to employees
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End-to-End VAT solution by SAP : Tax Compliance
Exceptions –
Tax Compliance hits
Check Repository
1. Connect data sources Legacy SAP OracleNon
Transaction
People
Soft
Routing
CFO IA BU IT
3. Receive / validate exceptions
Check Source System CFO IA BU IT
integrated dashboard
4. Take corrective actions
Routing
Notifications
Manage
Tasks
Collaborate
Status
Workflow
Examples:
• Master data related checks
• Transaction data related checks
• Special checks like Chain transactions”
2. Manage / Optimize Checks
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Product standard globalization is…
+ +
Translation InternationalizationFunctional Localization
The foundation for globalized, localized, functioning solutions
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130+countries
Globalization Services
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KSA Localization Roadmap
2000 - 2012 2013 – 2014 2015 – 2016 2017- 2019
SAP ERP Foundation (Arabic + RTL + Hijri Calendar)
HCMPublic Sector (الخدمة المدنية)
Finance Private Sector
FinancePublic Sector (وزارة المالية)
* Future Roadmap topics are Subject to SAP disclaimer
Real-EstateMobile Apps &CRM Int.
SuccessFactorsArabic & EC Localization
Zakat and Tax(الزكاة والدخل)
HCMKSA Military & Defense
(الضباط و األفراد)
Arabic & RTLBI, SSM, BPC & Fiori…
* Arabic & RTLHybris MK, Digital Boardroom & Ariba
* Finance PS Updates (Payroll Posting,
Payment Order & Reporting)
* SuccessFactors
PS Personal Actions for Cloud
* Finance
S4/HANA Cloud Localization
FinanceKSA government GFSM 2014
ByDesignTax service enablement for KSA
VAT updates for KSA
SuccessFactorsVisa Management for Cloud
SuccessFactorsTickets Benefits
Defense & SecurityIndustry + Arabic Mobile Apps
HCMMuqeem Services Enablement
LC (Letter of Credit) & BG (Bank Guarantee)
HCMNew UI (Renewal interface)
HCMEnablement for HANA
HCMEC Payroll for Cloud
Arabic & RTLS4/HANA, C4C, EC, LMS & Contact
center
HCMKSA Private (قانون العمل)
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S4HANA
OnPrem
S4HANA
Cloud
S4HANA OP
SAP S4/HANA … Ready for Saudi Arabia
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Legal Requirements
Come unplanned Come in short notice Are mandatory Are often quite complex
Changes in Regulation
Global Requirements
Cross-country Requirements
Country specific Requirements
Core functionalities which are partly driven by local requirements, such as statutory
reports
Many countries, for instance European Union can be treated very similarly
Every country has legal requirements that differ from one country to another
Best Business Practice No legal requirement, but established practices used in a country or region
Legal Requirements & Changes in Regulations
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Localization Notification Application
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➢ SAP is your trusted partner for the digital transformation journey (part of KSA
2030) locally in KSA and Globally in 130 countries
➢ Tax regimes are not one time events and accompanied by frequent changes
(legal changes), SAP maintain its products to such changes
➢ SAP extends its localization benefits to entire market (SAP and Non-SAP
customers) through SAP Localization Hub cloud services
➢
Take-Away Messages
Local solutions. Global success.
Thank you.Contact information:
Khaled Musilhy
Director – Globalization Services
+971 56 6834589
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companies shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP or SAP affiliate company products and services are those that are
set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty.
In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or any related presentation, or to develop or release
any functionality mentioned therein. This document, or any related presentation, and SAP SE’s or its affiliated companies’ strategy and possible future developments, products,
and/or platform directions and functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason without notice. The
information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or functionality. All forward-looking statements are subject to various
risks and uncertainties that could cause actual results to differ materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements,
and they should not be relied upon in making purchasing decisions.
SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE (or an SAP affiliate company)
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