Retention Amount in Sales Order Showing with VAT in Manage Customer Line item– Require Exclusion VAT

[Vishal41]

Dear SAP Support,

We are using Payment Terms as a workaround to manage Retention Amounts in Sales Orders within SAP S/4HANA Public Cloud. However, we have observed a discrepancy in how the retention is displayed in the Manage Customer Line-Item app.

In the Manage Customer Line-Item app

• The retention amount appears in a separate line, which is expected.

• However, both the main amount and the retention amount include VAT, which results in a total VAT value that is not aligned with our requirement.

Business Requirement:

• Retention amount should be displayed without VAT.
• VAT should only be applied to the net payable amount, excluding the retention until it's due.

Request:

We would like to know:

1. Is there a standard configuration or best practice in SAP S/4HANA Public Cloud to exclude VAT from the retention line?
2. Can retention amount be excluded from VAT calculation or shown separately in reporting?

Regards,

Vishal

[HenrikeGrötecke]

Hello, thank you for your question. It has been forwarded to the experts. Kind regards, Henrike

[DequanXu]

Hello,

Excluding VAT from Retention Line

Based on SAP S/4HANA configurations for managing VAT and retention amounts, it is possible to configure VAT handling so that retention amounts are excluded.

1. Tax Handling Configuration: Processing VAT on Retention You can specify whether to apply VAT to retention documents or not. This configuration is performed per country/region and requires checking the ‘Tax Reduction’ checkbox in relevant settings.
2. Manual Entries: Manual correction might be needed if automatic processes do not accurately assign VAT as per custom needs.

Separate Reporting and VAT Calculation

• Configuration Entries: Ensure proper configuration in the ‘Tax Handling for Retention’ and related activities, such as maintaining tax codes and settings that differentiate VAT treatment for retention documents.
• Custom Reporting: Generate reports separately to ensure retention amounts and relevant VAT are correctly displayed or omitted as necessary.

Best regards, Dequan Xu