When TAX registration numbers mimic each other

 When TAX registration numbers mimic each other


A company can charge tax for sales if it's VAT registered if it's in the same country. If the company is not registered for TAX it cannot charge the tax on the sales. 

Registration numbers of different countries are to be distinct. but that's not the case all the time. Registration numbers can get tricky

Let me explain this by an example 

I was working on a particular case which was stuck in tax error. The reason being the transaction was taking place from Singapore to Thailand.

  • Singapore vendor is VAT registered in Singapore. It can charge tax if it is selling to a Singapore customer. 
  • But what if it is Thailand customer? Singapore vendor can charge tax if they are registered in Thailand as well. If not, the invoice will be with zero taxes from the vendor side. 


In current scenario tax was getting calculated. Because the registration number of Singapore vendor was matching with the format of Thailand. Hence tax engine assumes the vendor is registered in Thailand. And calculates standard tax rates.

Solution:
To process this invoice. Masking the Thailand registration with some tweaking in the tax engine would be one way.

#tax #sales #singapore #taxes #oracle #tax #sap #taxes #sabrix #onesource #work #indirecttax

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