Ebtax Series 1 Automate Tax Determination Before Ar and Drive Tax From Order Management Presentation 611

8/16/2019 Ebtax Series 1 Automate Tax Determination Before Ar and Drive Tax From Order Management Presentation 611

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REMINDER

Check in on the COLLABORATEmobile app

Automate Tax Determination before AR and

Drive Tax from Order Management

This session is part 1 of 5and is delivered as part of the‘eBTax Exploration Series’.

Session ID #10032:

@ebizanswers

eBTax Exploration Series #1

Prepared by:

Mr A.Bohnet

Oracle R12 and Fusion eBTax Senior Consultant

eBiz Answers Ltd


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AGENDA

!

Introduction" About the Presenter

" Company Information

" Collaborative SIG

"

Tax Management SIG! Overview eBTax Exploration Series

! Depot Repair – Always a service

! Bonded Warehouse

! Transaction Types

! Thank You


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INTRODUCTION:ABOUT THE PRESENTER

Andrew Bohnet

! Oracle R12 and Fusion eBTax Senior Consultant

! Founder and Director of eBiz Answers Ltd

! OAUG Chair for ‘Oracle Tax Management SIG’

!

18 years Oracle Financials – 8yrs on global R12 projects! Currently assists clients in configuring eBTax to meet

requirements

! Performing eBTax System Audits to eliminate VATnon-compliance

! Developed eBTax Rapid Install™

" Roll out 30 countries in 2 hours


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INTRODUCTION:COMPANY INFORMATION

! Only specialist Oracle R12 and Fusion TaxConsultancy globally

! Provides an end-to-end experience:" Consultation

" Design

" Integration

"

Implementation! We always deliver

" Training

" Reporting

" Support

"

System Auditing


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INTRODUCTION:COLLABORATIVE SIG

!

Since 2011 the Special Interest Groups have collaborated on joint presentations focused on a single threaded topic to allowconference attendees to participate in end-to-end businessscenarios designed to stimulate conversation and educateend users.

! The Collaborative SIG is coordinated by:

" Mohan Iyer ([email protected]) of the General Ledger SIG

" Han Kolbe ([email protected]) of the Multi-National SIG

"

Thomas Simkiss ([email protected]) of the Multi-National SIG"

Special thanks to Melissa Sider ([email protected]) for assisting

with coordination on this collaboration.


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INTRODUCTION:TAX MANAGEMENT SIG

!

The Oracle Tax management SIG (formerly known as theOracle E-Business Tax and Fusion Tax SIG) are a keycomponent of the Oracle E-Business Suite and Oracle Fusionrespectively. The products have many unique features, andboast a flexibility rarely seen in a tax compliance package.

Members of this Special Interest Group (SIG), are expected toweigh in on both the benefits of and issues encountered withusing eBTax / Fusion Tax to solve transaction based taxcompliance problems in daily transaction processing.

! The Tax Management SIG is coordinated by:

" Andrew Bohnet ([email protected]) Co-chair of the Tax Management SIG

" Paul Kirch ([email protected]) Co-chair of the Tax Management SIG

" Angie FauntLeRoy ([email protected]) Education Chair


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INTRODUCTION:COLLABORATIVE SIG PRESENTERS

Presenter Company About the Presenter AndrewBohnet

eBiz Answers Andrew is a Principal at eBiz Answers Ltd,and a leading light in Oracle E-Business Taximplementation and upgrade in the EMEAregion. He has been the SIG's EU RegionEducation Chair since 2012 and became theTax Management SIG co-chair in 2014.

Dev Singh KPMG Dev is a Manager within KPMG’s CanadianIndirect Tax Practice focusing on Tax Processand Technology. Dev has lead the e-BusinessTax stream for many Financial Transformationprojects including an implementation for oneof North America’s leading retailers.

Paul Kirch Paul Kirch,Inc.

Co-Chair of the Tax Management SIG, Paul

Kirch specializes in global implementation ofOracle R12 & Fusion. Whilst PracticeManager at Oracle, he headed project teamsof 50+ with budgets of $20 million+ andfrequently presented at OAUG and OOW.


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INTRODUCTION:COLLABORATIVE SIG PRESENTERS

Presenter Company About the PresenterJayChandran

Paul Kirch,Inc.

Jay Chandran has over 17 years experiencein the fields of Finance, Accounting, BusinessProcess Re-engineering and ERP. Founderand Director of Simplex Data Technologies inCalifornia, Jay has held senior positions inOracle eBusiness Suite Consulting.

AshishNagarkar

ASTCorporation

Mr. Ashish Nagarkar is a PMP & OracleCertified Implementer with over twelve yearsof systems experience with ERP and softwareprojects. His functional expertise spans acrossProcure-to-Pay, iExpense and E-business taxand most of the Oracle Financial Suite.

CharlesBauman

BizTech Chuck is a Senior Business Analyst andProject Manager at Biztech with over 20 yearsof Corporate Accounting and OracleFinancials and Supply Chain Managementexperience. He has completed over 15 R12eBusiness Tax implementations.


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OVERVIEW:eBTAX EXPLORATION SERIES

If there is a specific topic or area you’d like to see covered, please reach out to yourSIG or chapter lead with ideas for future sessions.

Session ID Session Date & Time Room

# 10032

eBTax Series #1: Automate Tax

Determination before AR and Drive

Tax from Order Management

13 April 201510:30-11:30 AM

Breakers L

# 10033eBTax Series #2: eBTax and the

Procure-to-Pay Process

13 April 2015

12:45-1:45 PM

Breakers L

# 10034eBTax Series #3: Intercompany

Transactions and Tax 13 April 20152:00-3:00 PM

Breakers L

# 10035eBTax Series #4: Integration and

Upgrades with eBTax 13 April 20153:15-4:15 PM

Breakers L

# 10036eBTax Series #5: Tax Configuration

and Q&A 13 April 20154:30-5:30 PM

Breakers L


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Depot RepairAlways a service


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Client Requirement

!

Client sold and installed weather measuring equipment.

! If an item failed, a support engineer would go to the siteto make the repair.

! They would take existing stock items which they would

charge the client.

! Under the EU VAT laws, they had to charge the entiretransaction as a service.


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The Issue

!

Thought they were going to haveto duplicate all items so one wasflagged as a Service and the other

as Goods!


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So how did we resolve the issue?

!

By defaulting a dummy tax codeonto every order coming from theDepot Repair Module.


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Resolving the Issue


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Bonded Warehouse:


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What is a Customs bonded warehouse?

!

A Customs bonded warehouse is a building orother secured area in which imported dutiablemerchandise may be stored, manipulated, orundergo manufacturing operations without

payment of duty for up to 5 years from the dateof importation.


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Bonded Product


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Bonded Product

! We have a pile of coal in a bonded yard.


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Bonded Product

! 30% has been custom cleared, the remaining 70%

remains in a ‘bonded state’.


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Bonded Product

! When we make a sale of either bonded or non-bonded product, the tax rates

determined would be very different.

Example:

Ship From (location of Coal) is NL

Ship To customer is in Germany

"

If we sell coal that has been customs cleared and in free circulation of the EUthen we would charge a 0% NL EU SALES GOODS rate.

" If the Coal has not been customs cleared and remains in a bonded state, then we

still charge a 0% tax but this time it is out of scope of NL VAT.

! But to the customer, the difference is huge. In scenario 1 above, the DE customer

would have to apply a reverse charge against the purchase. If they are VAT

registered then this usually means no tax is effectively paid.

! But if they are buying bonded stock, then they are liable for the import duties at 19%!

If you as a supplier accidently charge the EU VAT and have not cleared the stockthen you have committed VAT fraud and are liable for the VAT due.


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Issues

!

Oracle does not provide standard functionality for this.

! Oracle has no functionality to recognise products in abonded state.

! Cannot use items as a way of dividing as an item canchange state from bonded to customs cleared at any point.

! The tax engine can not use a DFF as a determining factor.


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Solution

!

We split the pile of coal in the Oracle system into two separatelocators.

! And using the DFF of the locator that has the bonded coal, westore a value of ‘BONDED’.

! When the order line is created with the appropriate stock chosen,a trigger will check the DFF of the inventory locator.

! If it is BONDED, it will copy this value into the ‘tax classificationcode’ field (we would have created a dummy tax rate calledBONDED).

!

Then we can incorporate this determining factor into our tax rules.


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Solution

If Ship from = NL And Ship to = EU And Tax Classification code = BONDED

Then charge NL EXPORT

If Ship from = NL

And Ship to = EU

And Tax Classification code = NULL

Then charge NL EU SALES GOODS


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Benefits of Customisation

!

Configuration" Primarily uses Oracle standard functionality.

" Easy to replicate and non-dependant setup.

! Development

"

Enhancement rather than customisation.

" Simplest solution, making it easy to create.

! Maintenance

" Extremely unlikely to be affected by patches.

" Tax module can be used to change rules.


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Transaction Types:


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Transaction Types


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THANK YOU FOR YOUR ATTENTION

For more information on the eBTax Management SIG, please visit:

http://www.ebstaxsig.oaug.org / eBTax Management SIG – LinkedIn

Special Thank You to:

!"#$ $&$$#'( #$ )*+, - '. / #( ,"& !"#$% '%()*+$,*- .!+/!01!"& (&0, )+&$&(,*1'( #( ,"#$ $&+#&$ #$2

eBTax and the Procure-to-Pay ProcessPresented by Dev Singh @ 12:45 – 13:45


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Ebtax Series 1 Automate Tax Determination Before Ar and Drive Tax From Order Management Presentation 611