Italy pre-configured Tax Codes in SAP S/4HANA Public Cloud - issue with Tax Code X0

[Shrinivas]

Hello Experts,

I have a query regarding Italy pre-configured Tax Codes in SAP S/4HANA Public Cloud - issue with Tax Code X0

X0 is defined as 'EU Input tax 10% no ded. (serv)' with EU Code  9 = Acquisition Tax or General Tax with Zero Balance

Vendor invoice created with Tax Code X0 is posting  non deductible tax 10% to expense line item as debit, and deductible tax 10% to Output VAT GL as credit which is as below.

But I think, being a non-deductible tax code, it should post  the tax amount as credit to Vendor line item instead of posting to output VAT GL 2210000.

Could you please check if tax code defined is correct, or there should be any modification required?

Thank you.

Regards,

Shrinivas

[pawan__kumar]

@Shrinivas Changing it to post directly to the vendor account would be a serious configuration error leading to non-compliant VAT reporting

[Lakshmipathi · Accepted solution]

Yes if the SAP delivered set up is not meeting your requirement, you can very well raise a ticket to SAP.  The other option is you can copy the existing SAP delivered tax code, and modify to suit your requirement.

[Shrinivas · Accepted solution]

Thank you very much. I will now create an Incident with SAP for these tax code, Regards,