Base Amount and Cash Discount 

The tax amount that you input when entering an invoice is checked by the system when the invoice is posted. Alternatively, you can have the system calculate the tax amount automatically. The tax amount is usually calculated from the expense or revenue item, which is the tax base amount. The composition of the base amount varies from country to country. The base amount can (but does not have to) include the cash discount amount. This information must be defined for each company code.

If the tax base amount includes the cash discount amount, the tax base is gross; if not, it is net. You make these specifications in the Implementation Guide for Financial Accounting in the activity Specify Base Amount. See also Configuring the System Using the Implementation Guide.

In addition to the tax base amount, you can also define the base amount for calculating the cash discount (per company code). For information about the cash discount amount, see Terms of Payment and Cash Discount.

Note that only the following combinations are possible: