Archive for July, 2014

VAT changes in the digital (download) world


VAT Changes in the digital world

From 1 January 2015, businesses involved with electronically supplied services (digital services) to private individuals face more changes to the VAT ‘place of supply’ rules. Currently these changes are being made in the EU and South Africa to apply VAT on supplies of e-services made by non-resident suppliers to local customers. There are many practical issues that digital companies face in dealing with the shifting tax landscape. Although still a long way off, affected businesses need to start planning now. Continue Reading

The Use of VAT or GST compared to other forms of indirect tax


Why is getting VAT right so important?
VAT (Value added tax) is now the most common form of consumption tax system used around the world, figure 1. Yet many Businesses find that VAT is the most complex tax that they have to deal with. It’s not hard to see why, with the rules and regulations constantly changing businesses struggle to keep up and ensure that they pay the right amount of VAT, and the consequences of getting it wrong can be very costly.
From fines for not paying the right amount of tax or missing out on tax that could be reclaimed it’s not something you can afford to ignore, especially for businesses operating in multiply countries or tax jurisdictions.
VAT Indirect Tax Type Used Globally
Even though the principles of tax are broadly the same across the world, the rules are implemented and enacted differently, so the compliance burden on businesses can vary significantly. The more complicated the VAT system the longer it can take to comply and the longer it will take for businesses to get refunds. On average it takes 40% less time for businesses to process their corporate income tax than it does for them to process VAT. It also varies greatly by country, but on average in the EU it takes 73 hours to comply with VAT.
A poorly designed indirect tax system will only add to the hours needed to comply with regulations, adding stress and potentially resulting in costly audits.Different administrative practices and the way in which VAT has been implemented are key reasons for the range in hours that it takes for businesses to comply with VAT requirements. With this in mind and the fact that the Oracle R12 e-Business Tax module allows for a fully automated solution, why do so many companies suffer such poorly designed indirect tax solutions?  At eBiz Answers, we understand these requirements and work closely with our customers to ensure that not only are your existing indirect tax needs met, we also provide a structure to allow for the easy adoption of any changes, be they driven from the business or due to statutory requirements. We work around your specific requirements and produce a tax solution tailored to your needs, this will significantly reduce the hours needed to implement new tax systems and comply with old ones, saving you both time and money.

Czech Vat rate

New Czech Vat rate

Under the new EU VAT directive, member states are permitted two reduced VAT rates. Following this, the Czech government has announced a second reduced VAT rate of 10% to be implemented by January 2015. The current reduced VAT rate is 15%. This new reduced VAT rate will apply to medicines, pharmaceuticals, e-books and baby food products. The standard rate of VAT rose by 1%, to 21% in 2013 as the country tried to control its government deficit.
This third 10% rate of VAT, has been estimated to cost the government nearly 3 billion Czech Krones. (Around £85.6k)
Originally there were also proposals for a 5% reduced rate and a Czech VAT rate simplification proposal (combining the standard rate of 21% with the 15% reduced rate to create a 17.5% VAT rate). However these proposals were dropped due to complications of managing government and company accounting systems.

Why eBiz answers succeed where the big four don’t

The primary reason why eBiz Answers succeeds where others don’t is because we know both VAT and Oracle so we bring the solution with us.
Our lead consultants have 20 years’ experience on global solutions implementing and supporting Oracle ERP projects and all have a financials background that provides the ability to really get into your business to best identify the source information that will ultimately determine your tax. Because we bring the solution with us, rather than wasting your time and money documenting the existing process flows and then trying to manually build your solution from scratch we provide a the solution then we work on the gaps if there are any. Just as any other third party tax solution on the market, we know that tax is tax, the same rules apply to everyone and so we have pre-built these rules.

We have a repository of country tax regimes with all the rates and rules that are needed to meet the majority of your needs but unlike any third party product, all our set up is in Oracle, all standard functionality all within your existing Oracle licence. Our in-house developed ‘eBTax Rapid Install™‘ tool means that we can have you setup, with a fully automated tax solution within minutes that would usually take weeks to manually do. We use this same tool to then migrate the tax solution from instance to instance saving time and ensuring 100% accuracy. We know the Oracle tax engine inside out and more importantly, we know what it can’t do so if we have not already got a work around to missing oracle functionality, we will know the best way to get one.

 

Oracle eBTax Exempt, Zero or Out of scope – does it make a difference

Unfortunately there is a big difference between ZERO and EXEMPT. If we were to sell everything as EXEMPT then we would not be able to recover any tax at all, if we sold everything as ZERO then we can recover 100% of the tax. Because banks sell many things as either EXEMPT or out of Scope (Exempt, Out of Scope and Zero are 3 very different rates) they can only recover a certain amount of tax, the amount could be as low as just 1%. Luckily in AP, if we accidentally put something as Zero when it should be EXEMPT then it does not matter so much.

 

eBiz Answers Going for Gold in the UKOUG Partner of the Year Awards

UK Oracle User Group has revealed the shortlisted companies for this year’s Partner of the Year Awards which features 18 award categories.

We are honored to announce that eBiz Answers Ltd has been shortlisted for the following Partner of the Year Awards:

  • UKOUG Innovative (Product/Service) Partner of the Year

  • UKOUG Small Business/General Business Partner of the Year

  • UKOUG Independent of the Year

The announcement follows an initial round of nomination judging by a team of adjudicators formed from UKOUG’s end-user members. Over 45 entries were judged and whittled down to form up to six shortlisted Partner entries per category, who will now compete for the prestigious awards. 

UKOUG invites Oracle end-users to vote for their preferred Partners in Bronze, Silver and Gold positions, in as many categories that are relevant to them.

Vote before 15th September – http://pya.ukoug.org

 

Oracle R12 eBTax Fusion Tax eBiz Answers Solution

The driving factor in our solutions is that Tax is Tax. It does not matter what business you are or where you are located, you will have to abide by the same rules as everyone else and sure, some companies may have different recovery rates or exemptions but the concept for driving these are the same. What we find, time and time again is that when using eBTax, the solution is built from the ground up each time. Consultancies will make a fortune from their clients mapping all the processes and trying to develop the solution with the client who in most cases has knowledge of indirect tax and their business but no idea on how to convert that to an efficient Oracle eBTax solution as they have minimal knowledge of the module. Think of it like converting a book from English to German word for word, the structure in German would not make sense at all and whilst you would get an idea of what is going on, you won’t have the complete picture. We are the translators, we know the tax module inside out, we know the work around and we also know the other modules that use tax so understand the flow of data and where tax will be affecting the various business processes. We take what the tax department requests and we advise them on how Oracle will best handle these requirements What we do is bring that solution with an 80% fit and then we build the 20% to ensure all your needs are met. Think of us as a 3rd party tax provider but without being a 3rd party!