SAP Business ByDesign Country Localization for Azerbaijan, Turkey, and Egypt
Challenges/Requirement
SAP Business ByDesign lacks localization for Azerbaijan, Turkey, and Egypt, requiring manual tax calculations for business operations in these regions.
Technical Solutions
SAP Business ByDesign offers the ability to create localizations through SAP Cloud Application Studio. This process involves configuring various business settings to meet local tax requirements.
Tax Type
Each country will have distinct tax types, with various rate types (e.g., withholding standard, withholding reduced) assigned accordingly. Tax rates define types like standard, reduced, or zero. You can create custom tax rates by setting descriptions and codes as needed.
Tax Events
A Tax Event is a key component in tax calculation, defining specific tax scenarios and serving as the initial step in the tax process. Each country has distinct lists of tax events for product and withholding taxes.
Tax Codes
A tax code uniquely combines tax event, type, and rate for a specific country, such as domestic goods sale or standard rate.
Tax Declaration Profile
A tax declaration profile defines reporting combinations of tax types, events, or income types for each tax declaration type and country. It also specifies the format and business context, and is used for both withholding and product taxes.
Based on the requirements, you can add a Business Configuration Object.
Withholding Tax Configuration
A major purpose of withholding tax on accounts payable payments is to ensure that income tax is paid to the tax authority on these payments which represent income. The withholding tax has to be collected and remitted regardless of the retainage or installment.
WhtRateDet: From the dropdown list, select one of the values as below:
- Supplier and entire line-item base amount
Select this value if you want the withholding tax rate to be determined by a tax rate type.
- Income type and entire line-item base amount
Select this value if you want the withholding tax rate to be determined by an income type.
- Income type and percentage line-item base amount
Select this value if you want the withholding tax rate to be determined by an income type and reduced withholding tax base amount.
- Supplier w. time dependency and entire line-item base amount
Select this value if you want the withholding tax rate to be determined by a tax rate type which has a time dependency in the supplier master data.
Scoping
Once the localization is deployed, as a final step you will need to enable the country localization in the scoping section.
Expected Result
Once scoping is enabled, the system activates tax calculation for non-localized countries. The SAP Business ByDesign UI will then display updates, as illustrated in the sample provided for reference.
Business Benefits
Localization eliminates the need for manual tax calculations, saving time and reducing the risk of errors. This automated process operates in real-time in the background, preventing delays and enhancing overall efficiency. By streamlining tax calculations, localization ensures accurate and timely financial operations, allowing for smoother business processes and better resource allocation.
