VAT determination is challenging for any company with complex transactions in its supply chains. Business sectors such as manufacturing, pharmaceutical, construction, retail and logistics are particularly overburdened trying to manage this requirement.
Limitations in SAP functionality has created another level of complexity. Custom coding in SAP is often required to achieve reliable determination decisions and the need for ongoing customization makes maintaining master data difficult.
These challenges typically prevent companies from achieving a desirable level of transparency across their determination process. When a business deals with complex transactions, often due to multi jurisdictional supply chains, accurate VAT determination is vital. Any errors at this point can lead to severe consequences for accounting accuracy and financial resilience.