Tax recorded in entity where the vendor is not where the expense is.

[Hassanmurad0]

we have a situation where we use one company and the bank account to pay vendors so all the invoices are recorded to this company with vendor in that company as well. however the debit is coded to the company it is for, in this case, the tax calculated is recorded in the company where the vendor is whereas we want it to be recorded where the expense is so is there a configuration to achieve that or another way to reclass the taxes.

Current situation entries are like below

Cocode1 Vendor  Credit
Cocode1 Tax        debit
Cocode1 Interco   Debit

Cocode2  Expense Debit
CoCode2  Interco   Credit


What we will like is the tax line to be in the Cocode2

[Lakshmipathi]

Consider the below options

• If your tax is related to withholding, you can configure extended withholding tax to post to a different company code. However, this doesn’t apply to VAT or sales tax scenarios.
• Set up a clearing account in Cocode1 that temporarily holds the tax. Then, use a custom program or allocation cycle to transfer the tax to Cocode2 based on expense distribution.
• Explore going for custom validation via BAdI like BADI_ACC_DOCUMENT or BADI_FI_TAX_POSTING where the logic can be to detect intercompany scenario and Redirect tax line to the company code of the expense (Cocode2)