For cross-company code transactions, there are special prerequisites that must be fulfilled for invoices if:

• The receivables or payables are posted in a different company code to the one in which the revenue or expense (or costs) is posted

• The business transaction must be reported for tax purposes

In order to properly report the business transaction on the tax return, the company codes in this case must represent a single legal entity for tax purposes. This means that in the advance return for tax on sales/purchases, one company code represents all the other company codes. This is necessary because the system posts the taxes in the company codes in which the expense or revenue is posted, but the company code which receives or sends the invoice must create the tax return.