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The SAP Localization Hub tax service is switched to maintenance mode and tax engine functionalities have no successor solution, however, we offer an alternative solution to enable the integration between SAP S/4HANA Cloud or SAP S/4HANA and external tax calculation engines. This integration is tailored to support out-of-the-box the tax determination scenarios required for Brazil based on the corresponding localized best practice processes, however, depending on the SAP S/4HANA deployment options, it might offer extensibility options: 

  • SAP S/4HANA Cloud, private edition and SAP S/4HANA are equipped with a flexible extensibility framework that can be leveraged to develop consulting solutions for other countries, regions, and scenarios (guidelines can be found in this blog) 

  • SAP S/4HANA Cloud doesn’t offer extensibility options to adapt to other countries/scenarios. 

The figure below presents the new integration approach based on the SAP Integration Suite, which is a default SAP tool for integration, The SAP Integration Suite is the router between SAP S/4HANA Cloud, SAP S/4HANA, and External Partners. 

SAP provides generic integration templates (highlighted in green in the figure above) that must be deployed and configured in SAP Integration Suite. In this configuration, you can define routes to a specific partner or define different combinations of routes and partners using parameters existing in the message header received from SAP S/4HANA Cloud and SAP S/4HANA, as shown in the figure below: 

You can customize the standard templates both for enriching data for tax calculation and determining combinations of routes and partners according to your business needs. A given business process can be routed to one partner, while a separate process is routed to another partner. 

With this new integration for external tax determination, at this moment, you may be wondering: Where do I access the request and response payloads for auditing that was in the Tax Service? Access to the Audit Log (highlighted in blue in the first figure) is now accessible within SAP S/4HANA Cloud and SAP S/4HANA. 
NOTE: To access this feature in SAP S/4HANA Cloud, use the Tax Service Trace Transaction. For SAP S/4HANA, use TXS_TRACE transaction 

Key highlights: 

  • The API and connection configurations for SAP Tax Service continue to be available within SAP S4/HANA Cloud and SAP S/4HANA to enable tax determination via external tax engines, however, going forward, existing scenarios for Canada continue to be supported (maintenance mode) and the release of new functional content/scenarios will be limited to Brazil. 

  • Any customer-project automating tax determination via external tax engines can continue to re-use connections, standard integration templates, and configurations delivered with former SAP Tax Service in SAP S/4HANA Cloud, private edition, and SAP S/4HANA, however, no further functional content will be provided and maintained beyond Brazil. For more details, go to the Integration API.

  • Existing solutions offered for Sales & Use (US) tax determination via external tax engines continue to remain available (no changes). Details for SAP S/4HANA Cloud can be found in notes 2528016 and 2598888. Details for SAP S/4HANA Cloud, private edition, and on-premise can be found in note 1497956. 

For more details about Integration with External Tax Calculation Engine and Audit Log, have a look at the documentation in the SAP Help Portal.