Activating Plants Abroad in SAP

What is Plants abroad?

Plants Abroad functionality within SAP is a helpful addition in scenarios where a single company code has multiple VAT registrations across the European Union (EU). Plants Abroad functionality enables automated VAT and INTRASTAT postings for ‘cross border movements of own stock’ and also some additional reporting requirements related to cross border VAT registrations.

Plants Abroad is used to handle tax issues for companies that have VAT registration numbers in more than one country. Plants Abroad ensures that the correct value-added tax (VAT) registration number printed on sales and purchasing documents, calculates the right tax, handles stock transfers, and conducts tax and Intrastat reporting correctly. The plants functionality allows you to assign plants from different countries to one company code.

Plants abroad is activated at a client level. Moment we activate the plants abroad, reporting country field appear on the FTXP screen where the reporting country will be entered to create a tax code and reporting country field will appear on all the transactions screen where the tax code is required to be selected. Reporting country is used to generate country level VAT tax report where one wants to report VAT.

Although Plants Abroad functionality does not overcome any of the complexities in tax determination (which is a common misunderstanding) it brings about a number of benefits associated with VAT reporting and exchange rate functionality.

Benefits of activating Plants Abroad

• Automated cross border postings of VAT and Intrastat. This involves the use of so-called WIA documents that are triggered in respect of ‘stock transport’ orders.
• Additional tax reporting field within the tax code properties. This allows the possibility to maintain within each tax code the country in which this tax code will be reported for VAT reporting purposes
• Additional functionality for VAT specific exchange rates. With Plants Abroad functionality SAP has designed additional currency functionality to capture the amounts correctly in the tax details table (table BSET) using the country specific currencies.

Activating Plants Abroad in non EU countries

SAP has only enabled Plants Abroad functionality for movements of goods within the EU. If one (or both) of the plants is situated outside the EU, then the Plants Abroad functionality cannot be used within standard SAP.

When you move your own goods across the border to a NON-EU country the system doesn’t create the necessary VAT documents for the reporting of the cross border movement.

However, In order to over-come such issues Meridian has created additional functionality via the VAT Add-on to trigger WIA documents in cases where one (or both) of the plants is situated outside the EU.