In recent years, many companies rapidly realized they would need technology to handle the complete compliance process. Probably from calculation to returns to managing transaction data for many online channels serving clients worldwide.
Businesses now need to use cloud-based tax automation tools to efficiently manage their expanding tax obligations as the world of business moves more and more online.
Considering the need, Microsoft came to assist. Microsoft created a microservice called Tax Calculation service on the Microsoft Azure platform to enhance the tax calculation capabilities of the D365 app. It is also offering flawless configuration and flexibility.
With a plan to provide support for 1st and 3rd party apps in the near future, the solution is possible to link with Microsoft Dynamics 365 Finance and Supply Chain Management.
Why Choose The Tax Calculation Module Of Dynamics 365?
It’s wonderful to be able to automate and standardize tax calculations across various geographic areas. Thanks to formulae and circumstances that carry out intricate tax calculation regulations. In other words, it uses flexible computations to make it easier to maintain compliance with local tax requirements.
The solution, managed as the new feature in the Feature Management workspace, is backward compatible with the current finance and operations tax engines. Additionally, it can be enabled by a business procedure or a legal body for Australian residents.
Feature details
- Dynamics 365 Finance, Dynamics 365 Supply Chain Management, and Dynamics 365 Project Operations integration out of the box.
- Regulatory Configuration Service (RCS), an improved version of the Electronic Reporting designer that is a separate service, is used to configure the tax service.
- Configurable tax matrix to automatically determine tax codes and rates.
- Configurable tax matrix to automatically determine VAT ID.
- To define formulae and circumstances, use the configurable tax calculation designer.
- Solutions for tax calculation and determination are shared between legal organizations.
Capabilities of Dynamics 365 for Tax Calculation
The solution aims to assist businesses with the configuration and determination of tax codes, rates, and deductibility depending on any field of a taxable document through complex tax determination matrix building with cascade matrices and parallel metrics (for example, orders or invoices).
The use of multiple tax registration numbers under the same party (legal company, client, etc.) is supported in various situations, including price transfers and low-risk distributor models. Legal companies and their counterpart in sales, purchase, and transfer orders can now configure and ascertain the correct tax registration number.
Tax Calculation is a tax engine offering exponential scalability along with the following tasks:
- Utilize an improved determination method to automatically determine the relevant sales tax group, item sales tax group, and tax codes.
- Support for several tax registration numbers inside a single legal entity and the ability to automatically identify the correct tax registration number for taxable transactions.
- For transfer orders, support tax computation, posting, and settlement.
- Create customizable tax computation circumstances and formulae based on your unique business needs.
- To reduce maintenance time and prevent mistakes, share the tax computation and determination solution across all legal entities.
- Determine tax registration numbers for customers and vendors.
- Determine list codes with support.
- Support tax calculation parameters at the tax jurisdiction level.
Automating Complex Tax Scenarios
Thanks to the Dynamics 365 Tax Calculation updates published last year, our clients can automate challenging tax scenarios that previously required costly adaptations. Our customers have successfully enabled a variety of complex scenarios while adopting the new Tax Calculation features, including the following:
- Distributor with reduced risk and transfer price model.
- Warehouses for consignments with several VAT registrations.
- Transactions for EU triangulation.
- EU VAT on margin.
- EU distance selling.
- Origin- and destination-based sales taxes in the US.
- Utilization-based tax deductions for goods and services.
Bottom line
By utilizing this improved no-code/low-code tax computation tool, a component of Globalization Studio inside Dynamics 365, organizations from medium to large may automate tax calculations.
So, if you want to improve your tax management system, including financial reporting, and financial management, DHRP has suggestions to help you put the best solution into practice by looking at your company’s requirements. Let’s have a conversation to begin.
