Oracle Corporation
06/24/2024 | Press release | Archived content
This little known ERP feature cuts your tax prep time
Taxes are notorious. Not only because of the financial liability, but because of the meticulous work needed to document, calculate, and periodically report to governing authorities. They are especially challenging for organizations with operations spanning multiple tax jurisdictions, running high transaction volumes, offering diverse product types, and navigating complex tax rates and recovery strategies.
Tax preparers typically devote significant effort to gathering data, reclassifying transactions, calculating tax amounts, and reconciling miscalculations or other errors. It's onerous, but it doesn't have to be. The Tax Box Allocation feature in Oracle ERP Cloud can automatically summarize transaction tax amounts based on pre-configured rules-it allows you to designate how to calculate the values that go into the fields of a tax return, and then it does the math for you.
What it does
You can use Tax Box Allocation to:
Configure tax boxes based on tax categories required by governing authorities. There's considerable flexibility here. For example, you can define broad or narrow categories like "Domestic Sales" or "Taxable Imports from Country X."
Establish the factors that determine which tax box applies to an individual transaction, such as transaction type, location, or product category.
Create allocation rules that use tax-box definitions and determining factors. Rules can be simple ("all domestic sales go to tax box X") or more complex ("all imported goods from Country A go to tax box Y").
Automate tax allocation. After you've established the tax boxes, determining factors, and allocation rules, the system can automatically assign transactions based on the configured criteria.
Benefits
The efficiency-related benefits of automated tax-box allocation are obvious. But there are other benefits too, including:
Reduced risk, since an automated allocation process minimizes the chance of human error.
Enhanced compliance, because allocation rules are automatically applied.
Improved strategic focus, as tax teams shift away from manual calculations to focus on exception processing, tax analysis, and higher value-add initiatives.
Notably, there are no additional license fees and using these capabilities doesn't involve systems integrations or disruptions.
Wrapping up
You can dramatically streamline tax reporting by configuring Tax Box Allocation in Oracle Cloud ERP. Although it requires that you properly understand tax reporting obligations and transaction classifications, Tax Box Allocation does not require systems integration or other disruptive projects. Neither does it involve any additional fees. It is a straightforward way to take (some of!) the sting out of taxes.
Additional resources
Prepare Your Transaction Tax Returns with Tax Box Allocation
Manage Tax Box Allocation Rules
Next steps
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