import tax scenarios 1

ORACLE APPLICATIONS

WHITE PAPER

USE CASES FOR IMPORTING TAX LINES THROUGH THE PAYABLES IMPORT PROCESS JUNE 2009

Contributors: Narayana Palukuri, Product Management

Cheryl Riniker, AP Center Riniker of Expertise

Versions: 1 – June, 2009

Oracle/Client Confidential - For internal use only 1

Contents

Introduction.................................................................................................................................3

Objective...............................................................................................................................3Scope.....................................................................................................................................3Background...........................................................................................................................3

Importing Tax Lines Using the Payables Open Interface....................................................4

Overview...............................................................................................................................4Interface tables......................................................................................................................4Important Considerations while Importing Invoices with Tax Lines....................................4Important Tax Driver Columns.............................................................................................5

Use Case Scenarios..................................................................................................................7

Use Case 1: System Calculated Taxes..................................................................................7Use Case 2: Exclusive Manual Tax.......................................................................................7Use Case 3: Exclusive Manual Tax Applicable to All Item Lines........................................7Use Case 4: Exclusive Manual Tax Line Not Applicable to All Item Lines........................8Use Case 5: Multiple Exclusive and Manual Tax Lines.......................................................8Use Case 6: Multiple Exclusive and Manual Tax Lines, Not All Lines have Tax...............9Use Case 7: Multiple Exclusive and Manual Tax Lines, One Tax Line Prorated Across Many Lines..........................................................................................................................10Use Case 8: Multiple Exclusive and Manual Tax Lines, Same Regime to Rate Information..........................................................................................................................10Use Case 9: Inclusive Manual Tax......................................................................................11Use Case 10: Inclusive Manual Tax Line Applicable to All Lines.....................................11Use Case 11: Multiple Inclusive and Manual Tax Lines....................................................12

Information Sources................................................................................................................13


Introduction

Objective

The objective of this document is to provide various business use cases for how to populate tax line information in the ap_invoice_lines_interface that need to be imported through the Payables Invoice Import process. This document focuses on importing tax lines in R12.

Scope

This document defines use cases for importing invoices using Payables Open Interface Import with Tax lines. This document covers following scenarios:

Importing invoices which allow the system to calculate taxes after import

Importing exclusive manual tax lines

Importing inclusive manual tax lines

Background

The Payables Import Process provides the ability to import invoices from other sources, either for upgrade to R12 or as a part of their regular business processes if invoices are provided as part of a feeder system.


Importing Tax Lines Using the Payables Open Interface

Overview

The Payables Invoice Import is a concurrent request that should be submitted from an Accounts Payable (AP) responsibility. The purpose of the program is to interface invoice lines either from another module in Oracle Applications or for a system. The import

Interface tables

There are two tables that hold the data to be imported

AP_INVOICES_INTERFACE AP_INVOICE_LINES_INTERFACE

Additionally, the following table holds the rejection reasons if an invoice is not successfully imported.

AP_INTERFACE_REJECTIONS

Important Considerations while Importing Invoices with Tax Lines

1. The setup of ‘Configuration Owner Tax Option’ under the Defaults and Controls section of EB-Tax, controls the creation of tax lines for the invoices imported using open interface. Please select appropriate options during your implementation.

2. The Place of Supply option under ‘Tax Rules’ needs to be selected carefully during implementation

Tax Rules - ‘Place of Supply’ Options:- Operating Unit is for “Bill-To” location- Supplier & Supplier Site are for “Bill-From” and “Ship-From”- Location is for “Ship-To”

This setup is valid only for system calculated tax lines and not relevant for manually imported tax lines

3. For non-recoverable tax, the distribution will get the account from its corresponding ITEM line or EXPENSE account. For recoverable tax, the distribution will get the account from the account set up done at either Recover Rate or Tax rate and if neither are setup, then the interim tax account is used. The Validation process will get these distribution accounts.

4. In R12 you cannot have multiple tax lines with the same regime to rate information being allocated to a single item line. Single regime to rate can be allocated to multiple item lines for an invoice, however multiple tax lines with the same regime to rate information are not supported


5. If CALC_TAX_DURING_IMPORT_FLAG is set to ‘Y’ during import, EB Tax will calculate taxes automatically as per the tax setup. Following columns in AP_INVOICE_LINES_INTERFACE are tax driver columns, which may be used to determine the tax applicability during import:

PRIMARY_INTENDED_USE PRODUCT_CATEGORY PRODUCT_FISC_CLASSIFICATION USER_DEFINED_FISC_CLASS SHIP_TO_LOCATION_ID PRODUCT_TYPE TRX_BUSINESS_CATEGORY

Important Tax Driver Columns

PRORATE_ACROSS_FLAGIf this column is set to ‘Y ‘and this is a non-Item type line (Tax, Miscellaneous, or Freight), then Payables will prorate the charge to all Item type lines with the same LINE_GROUP_NUMBER as this line. If no line group number is specified, Payables will prorate the charge to all Item lines. If this column is set to N, then Payables will not prorate the cost and will create only one distribution. Payables prorates tax for Tax type lines, freight for Freight type lines, and miscellaneous for Miscellaneous type lines. Payables create a distribution line for each line you prorate the charge to. The system assigns the expense account of the Item line to the new invoice distribution.

LINE_GROUP_NUMBERIf a charge needs to be prorated to a group of lines, enter an identical line group number value for each Item line to which charge to be prorated. For example, if a tax to be prorated across two Item lines, enter the same line group number for the two Item lines and the Tax line.

CALC_TAX_DURING_IMPORT_FLAGIndicates whether tax should be calculated or not for the imported invoice. If this column is set to Y, then EBTax will calculate the tax automatically for the imported invoices based on Tax setup and data populated in Tax Driver columns of interface tables. Do not populate data in AP_INVOICE_LINES_INTERFACE with ‘TAX’ lines if this column is set to Y. For manual TAX lines, leave this column blank in AP_INVOICES_INTERFACE.

INCL_IN_TAXABLE_LINE_FLAGThis column is the flag to indicate if the amount in the tax line is included or not in the taxable line. For Exclusive Tax lines both for manual and system generated tax lines leave this column blank. This flag is only relevant to tax lines and for non-tax lines this flag should be populated as NULL.

Note: The count of AP_INVOICE_DISTRIBUTION_ALL rows given in the uses cases is based on the assumption that the taxes are non-recoverable. If a recoverable rate is not 100% for each tax line, there will be two distributions, a recoverable ditribution and a non-recoverable distribution line.


Use Case Scenarios

Use Case 1: System Calculated Taxes

Example: An invoice with one ITEM line and system should calculate taxes.

Set the CALC_TAX_DURING_IMPORT_FLAG to ‘Y’ and populate data in AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line1LINE_NUMBER 1LINE_TYPE_LOOKUP_CODE ITEMAMOUNT 100LINE_GROUP_NUMBERPRORATE_ACROSS_FLAGTAX_REGIME_CODETAXTAX_STATUS_CODETAX_RATE_CODEDIST_CODE_CONCATENATED 99-999-9999

Use Case 2: Exclusive Manual Tax

Example: An invoice with one ITEM line of 100 USD and one TAX line (manual and exclusive) of 10 USD

Populate the data in AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line TAX LineLINE_NUMBER 1 2LINE_TYPE_LOOKUP_CODE ITEM TAXAMOUNT 100 10LINE_GROUP_NUMBER 1 1PRORATE_ACROSS_FLAG YTAX_REGIME_CODE ATAX BTAX_STATUS_CODE CTAX_RATE_CODE DDIST_CODE_CONCATENATED 99-999-9999

After the Payables Import Process completes, the following number of rows should be inserted in the main tables.

Table Name Number of ITEM rows inserted

Number of TAX rows inserted

AP_INVOICE_LINES_ALL 1 1AP_INVOICE_DISTRIBUTIONS_ALL 1 2

Use Case 3: Exclusive Manual Tax Applicable to All Item Lines

Example: An invoice with two ITEM lines of 100 USD and 50 USD and one TAX line (manual and exclusive) of 15 USD.


Populate data in AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line1 ITEM Line2 TAX LineLINE_NUMBER 1 2 3LINE_TYPE_LOOKUP_CODE ITEM ITEM TAXAMOUNT 100 50 15LINE_GROUP_NUMBER 1 1 1PRORATE_ACROSS_FLAG YTAX_REGIME_CODE ATAX BTAX_STATUS_CODE CTAX_RATE_CODE DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888





Use Case 4: Exclusive Manual Tax Line Not Applicable to All Item Lines

Example: An invoice with three ITEM lines of 200 USD, 100 USD and 50 USD and one TAX line (manual and exclusive) of 30 USD. The TAX is applicable to only two ITEM lines of 200 USD and 100 USD.


Interface Column Name ITEM Line1 ITEM Line2 ITEM Line3 TAX LineLINE_NUMBER 1 2 3 4LINE_TYPE_LOOKUP_CODE ITEM ITEM ITEM TAXAMOUNT 200 100 50 30LINE_GROUP_NUMBER 1 1 1PRORATE_ACROSS_FLAG YTAX_REGIME_CODE ATAX BTAX_STATUS_CODE CTAX_RATE_CODE DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888 77-777-7777





Use Case 5: Multiple Exclusive and Manual Tax Lines

Example. An invoice with two ITEM lines of 100 USD and 50 USD and two TAX lines (manual and exclusive)



Interface Column Name ITEM Line1 ITEM Line2 TAX Line1 TAX Line2LINE_NUMBER 1 2 3 4LINE_TYPE_LOOKUP_CODE ITEM ITEM TAX TAXAMOUNT 100 50 10 5LINE_GROUP_NUMBER 1 2 1 2PRORATE_ACROSS_FLAG Y YTAX_REGIME_CODE P ATAX Q BTAX_STATUS_CODE R CTAX_RATE_CODE S DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888





Use Case 6: Multiple Exclusive and Manual Tax Lines, Not All Lines have Tax

Example: An invoice with four ITEM lines of 200USD, 150USD, 100 USD and 50 USD and two TAX lines (manual and exclusive). ITEM line of 200USD AND 150USD are associated with TAX line having TAX RATE CODE ‘D’ and ITEM line of 100 USD is associated with TAX RATE CODE OF ‘S’. ITEM line of 50 USD does not have any tax associated with it


Interface Column Name ITEM Line1

ITEM Line2

ITEM Line3

ITEM Line4

TAX Line1

TAX Line2

LINE_NUMBER 1 2 3 4 5 6LINE_TYPE_LOOKUP_CODE ITEM ITEM ITEM ITEM TAX TAXAMOUNT 200 150 100 50 10 35LINE_GROUP_NUMBER 1 1 2 2 1PRORATE_ACROSS_FLAG Y YTAX_REGIME_CODE P ATAX Q BTAX_STATUS_CODE R CTAX_RATE_CODE S D

DIST_CODE_CONCATENATED 99-999-9999

88-888-8888

77-777-7777

66-666-6666






Use Case 7: Multiple Exclusive and Manual Tax Lines, One Tax Line Prorated Across Many Lines

Example: An invoice with four ITEM lines of 200 USD, 150 USD, 100 USD and 50 USD and two TAX lines (manual and exclusive). The ITEM line of 100 USD is associated with TAX line having TAX RATE CODE ‘S’ and TAX line with TAX RATE CODE with ‘D’ will be prorated across all the four ITEM lines


Interface Column Name ITEM Line1

ITEM Line2

ITEM Line3

ITEM Line4

TAX Line1

TAX Line2

LINE_NUMBER 1 2 3 4 5 6LINE_TYPE_LOOKUP_CODE ITEM ITEM ITEM ITEM TAX TAXAMOUNT 200 150 100 50 10 50LINE_GROUP_NUMBER 1 1PRORATE_ACROSS_FLAG Y YTAX_REGIME_CODE P ATAX Q BTAX_STATUS_CODE R CTAX_RATE_CODE S DDIST_CODE_CONCATENATED 99-999-

999988-888-8888

77-777-7777

66-666-6666





Use Case 8: Multiple Exclusive and Manual Tax Lines, Same Regime to Rate Information

Example: An invoice with two ITEM lines of 100 USD and 50 USD and two TAX lines (manual and exclusive) but with same Regime to Rate information.


Interface Column Name ITEM Line1 ITEM Line2 TAX Line1 TAX Line2LINE_NUMBER 1 2 3 4LINE_TYPE_LOOKUP_CODE ITEM ITEM TAX TAXAMOUNT 100 50 10 5LINE_GROUP_NUMBER 1 2 1 2PRORATE_ACROSS_FLAG Y YTAX_REGIME_CODE A ATAX B BTAX_STATUS_CODE C CTAX_RATE_CODE D DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888

After the Payables Import Process completes, when tax is calculated either by clicking on ‘Calculate Tax’ button or during invoice validation two TAX lines imported will be merged to single tax line and only one row will be inserted into AP_INVOICE_LINES_ALL.



AP_INVOICE_LINES_ALL 2 1


AP_INVOICE_DISTRIBUTIONS_ALL 2 2

Use Case 9: Inclusive Manual Tax

Example: An invoice with one ITEM line of 100 USD and one TAX line (manual and inclusive) of 10 USD.

Set the INCL_IN_TAXABLE_LINE_FLAG to ‘Y’ for Tax line and Populate data in the AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line TAX LineLINE_NUMBER 1 2LINE_TYPE_LOOKUP_CODE ITEM TAXAMOUNT 100 10LINE_GROUP_NUMBER 1 1PRORATE_ACROSS_FLAG YTAX_REGIME_CODE ATAX BTAX_STATUS_CODE CTAX_RATE_CODE DDIST_CODE_CONCATENATED 99-999-9999INCL_IN_TAXABLE_LINE_FLAG Y

After the Payables Import Process completes, there will be no TAX line inserted for inclusive tax in AP_INVOICE_LINES_ALL and this tax is not visible in Invoice lines region of Invoice workbench. Inclusive tax details can be viewed in Tax Summary and Tax Detail window. Distributions corresponding to the Inclusive tax can be viewed in Invoice Distributions window.




Use Case 10: Inclusive Manual Tax Line Applicable to All Lines

Example: An invoice with two ITEM lines of 100 USD and 50 USD and one TAX line (manual and inclusive) of 15 USD

Set the INCL_IN_TAXABLE_LINE_FLAG to ‘Y’ for the tax line and populate the data in the AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line1 ITEM Line2 TAX LineLINE_NUMBER 1 2 3LINE_TYPE_LOOKUP_CODE ITEM ITEM TAXAMOUNT 100 50 15LINE_GROUP_NUMBER 1 1 1PRORATE_ACROSS_FLAG YTAX_REGIME_CODE ATAX BTAX_STATUS_CODE CTAX_RATE_CODE DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888INCL_IN_TAXABLE_LINE_FLAG Y


After the Payables Import Process completes, there will be no TAX line inserted for inclusive tax in AP_INVOICE_LINES_ALL and this tax is not visible in Invoice lines region of Invoice workbench. Inclusive tax details can be viewed in Tax Summary and Tax Detail window. Proration of tax amount for each ITEM line details can be viewed from Tax Detail window. Distributions corresponding to the Inclusive tax can be viewed in Invoice Distributions window.




Use Case 11: Multiple Inclusive and Manual Tax Lines

Example: AN invoice with two ITEM lines of 100 USD and 50 USD and two TAX lines (manual and inclusive)

Set the INCL_IN_TAXABLE_LINE_FLAG to ‘Y’ for the TAX line1 and populate data in AP_INVOICE_LINES_INTERFACE as below:

Interface Column Name ITEM Line1 ITEM Line2 TAX Line1 TAX Line2LINE_NUMBER 1 2 3 4LINE_TYPE_LOOKUP_CODE ITEM ITEM TAX TAXAMOUNT 100 50 10 5LINE_GROUP_NUMBER 1 2 1 2PRORATE_ACROSS_FLAG Y YTAX_REGIME_CODE P ATAX Q BTAX_STATUS_CODE R CTAX_RATE_CODE S DDIST_CODE_CONCATENATED 99-999-9999 88-888-8888INCL_IN_TAXABLE_LINE_FLAG Y

After the Payables Import Process completes, there will be no TAX line inserted for inclusive tax (TAX Line1) in AP_INVOICE_LINES_ALL and this tax is not visible in Invoice lines region of Invoice workbench. Inclusive tax details can be viewed in Tax Summary and Tax Details window. Distributions corresponding to the Inclusive tax can be viewed in Invoice Distributions window.





Information Sources

Oracle® Payables Reference Guide, Release 12, Part No. B25455-03


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