Tax Translation Between Local and Foreign Currency 

Use

In Slovakia, when you post a document denominated in foreign currency, you have to round down the koruna VAT (value-added tax) amounts to the next 10 haleru (see the example below).

In the system, if you work with the following Enjoy transactions, you have to configure the system to prevent it from converting the koruna VAT amount back into the foreign currency:

·        Accounts Payable(FI-AP), Accounts Receivable (FI-AR): Enter Invoice/Credit Memo

·        Logistics Invoice Verification (MM-IV-LIV): Enter Invoice

Activities

Customizing

Switch off the currency translation function in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global Settings ® Tax on Sales/Purchases ® Basic Settings ® Switch Off Tax Translation between Local and Document Currency.

Day-to-Day Activities

When you enter a document in foreign currency and you need to round down the proposed koruna VAT amounts, overwrite the amounts proposed by the system. In MM-IV-LIV, overwrite the VAT amount displayed on the Tax tab.

The system automatically posts any differences as foreign exchange losses.

Example

A vendor, Deries SA, supplies you with EUR 600 of goods, taxed at 15%. You enter the goods receipt in euros and the system automatically converts it to koruny at the exchange rate of EUR 1 = SKK 43.3688:

The system proposes a VAT amount of SKK 3,903.22. You overwrite the VAT amount, to round it down to the next 10 haleru (SKK 3,903.20). Normally, the system would reconvert this amount back into euros, but your Customizing setting prevents it from doing so. The system posts the 2 haleru difference as a foreign exchange loss. The final accounting document thus looks like this:

See also:

SAP Note 406563