Tax Jurisdiction Code 
Definition
A code used for determining tax rates in Brazil; it controls which tax authorities must be paid for a given transaction.
Structure
The tax jurisdiction code is comprised of the following two parts:
Characters |
Contain |
1-3 |
|
4 up to 16 |
Municipal (município) code |
The system additionally requires the second part of the tax jurisdiction code, the municipal code, to calculate ISS; for ICMS and SubTrib, the three-character tax region is sufficient.
Integration
When you maintain Brazilian address data in master records or transaction data, and enter the postal code and geographical region, the system automatically assigns the correct tax jurisdiction code by accessing the entries in Customizing for Financial Accounting (FI), under Financial Accounting Global Settings ® Tax on Sales/Purchases ® Basic Settings ® Brazil ® Assign Postal Codes to Tax Jurisdiction Codes. If it does not find an entry here, it reads the tax region from the Define Brazilian Tax Regions and Assign to Geograph. Regions activity.
Once the system determines either the tax jurisdiction code or the tax region, it stores the value in the Jurisdict. Code field of the address.
The municipal code you enter as part of the tax jurisdiction code is not the same one you may have entered as the city code in Sales and Distribution (SD), which is visible in the customer and plant masters, but not in the vendor master (in Customizing for SD, under Basic Functions ® Taxes ® Define Regional Codes ® Define City Code). You must always enter tax jurisdiction codes for the system to calculate ISS.
Example
Assume that you procure window-cleaning services from a company located in the tax jurisdiction of São José do Rio Preto, and for calculation of ISS, the location of the service provider is the tax-relevant location. In Customizing, you define the tax region SP for the state of São Paulo. São José do Rio Preto has the municipal code 4980, so you define the tax jurisdiction code SP 4980. Note that the space after the SP counts as the third character of the tax region.