We know that Accounting document are replicated to CFIN and all those accounting document also replicate the Tax related information while posting the document in the CFIN system. However, if only replication is in scope Tax reporting is being done from the Source kernel itself.
Source system is actual source of business transaction and all the relevant information from the source are used for the tax reporting.
But when the Central Payment is Activated in Central finance the posting is being made in the Central finance system on company code wise and hence the reporting must be carried out in the central finance system.
What is pre-requisite of the Tax reporting in CFIN.
Before loading the data in CFIN Tax-relevant configuration must be checked.
Architecture of TAX engine in Central finance:
Consistency check in Central finance:
Consistency check is tool provided by SAP to compare the configuration related configuration Master data item and report them if them before the actual loads starts. Its always recommended approach by the SAP to first resolve the Inconsistencies of Configuration.
Tax-configuration Consistency check:
Tax recalculation check – System makes a comparison in the tax posting values in source system and the replicated documents in CFIN systems and if there are differences exceeding the threshold, then document is visible in AIF as error message and needs to be corrected before reprocessing.
Limitations in Tax reporting:
SAP central finance does not (as of now) support Official Document Numbering (ODN) functionality, which is mandatory for some countries from legal reporting purposes. These countries tax reporting need to be performed from source kernel.
Central Finance does not currently support deferred tax with the initial load.
Standard Tax reports.