Correction Object
Definition
Object or measure for which input tax has to be corrected according to law.
It can be one of the following:
Fixed asset or intangible asset
Current asset
Subsequent acquisition and production costs for asset
Other equipment or services that subsequently become part of the asset
Even services that do not become part of the asset
Use
Selecting the line items and input tax amounts that should be viewed together from a tax standpoint is the task of a competent person. This selection is mapped in the system in the form of correction objects. You create correction objects in the system as master data.
Note
For more information on processing correction objects, see Creating Correction Objects .
Structure
The correction object contains the following data:
Information about the asset for calculating and posting the input tax correction:
Correction period
Option rates, or the calculation formula for them
Objects providing the data used for determining option rates
Account assignment object
Basis for input tax correction (input tax amounts that are used as the basis for the input tax correction)
Information that controls the assignment of line items to this correction object: allowed account assignment objects, period of service
Examples
A building is repainted. The painting work is completed on May 31, 2005. You create a correction object called "Repaint Building," with a correction period starting on June 1, 2005.
In the same year, the furnace in this building is overhauled. The overhaul of the furnace is completed on September 5, 2005. You create a correction object called "Furnace Overhaul," with the correction period starting on September 1, 2005.
There are regularly recurring cleaning costs for the building.
These cleaning costs are not eligible for input tax correction, so you do not need to create a correction object. You can explicitly prevent input tax correction for these documents by excluding the G/L account for cleaning costs from input tax correction in Customizing.