Use Your HANA Migration to Solve Your Tax Challenges for Good

Sovos
June 18, 2018

Companies dealing with complex sales and use tax determination, VAT regulations and other tax challenges across the globe know that SAP alone is not equipped to support the varying requirements from country to country. As SAP sunsets support and updates for ECC and R3, companies must move to HANA to keep their systems up to date. With this inevitable change to S/4HANA or HANA Enterprise Cloud, now is the perfect time to step back and develop a comprehensive strategy to managing tax worldwide.

SAP users must migrate to HANA by 2025, but a majority have not yet started the process. Since the move requires major changes to ERP infrastructure, SAP users with global operations should take advantage of the unique opportunity to be more strategic in their implementation. With the right approach, companies can future-proof their solutions in a way that ensures they can keep pace with constant changes in tax regulations throughout Latin America, Europe and beyond.

Learn how to minimize business disruption during an SAP S/4HANA upgrade project in the wake of modern tax: Read Preparing SAP S/4HANA for Continuous Tax Compliance and don’t let the requirements of modern tax derail your company.

Governments around the world are implementing technology for tax enforcement. In order to keep up, companies must make the digitization of tax a core pillar of their HANA migrations.

In the move to HANA, companies must consider the new world of tax, which includes:

  • Constant change management – Companies must be able to anticipate and quickly adapt to major tax reform legislation and smaller rate and field changes while not disrupting operations or risking non-compliance.
  • Internal processes – Compliance often requires changes to basic processes, procedures and technologies employed by global companies. For example, in Latin America, logistics can be impacted by VAT regulations because many countries now require eInvoices to act as a bill of lading, created before products can ship.
  • Required automation – Standardization requirements in Latin American and Europe are designed to quickly identify errors and data discrepancies by eliminating paper-based reports in favor of automated processes. Companies must automate their own operations to avoid errors and audit triggers.

The move to S/4HANA or HANA Enterprise Cloud requires companies to move all of their processes, customizations and third-party add-ons to the new platform. As such, there are several critical considerations.

What to migrate, and when

Since most companies’ SAP ERP systems have been built and customized over many years, many will benefit from a phased approach to HANA implementation. The less customized modules, such as Financial Accounting (FI) and Controlling (CO) will be easier to move than Materials Management (MM) or Sales and Distribution (SD), which will need a long-term plan for customizations.

What to do with customizations and third-party apps

Many SAP configurations have become a patchwork of customized code and bolt-on applications. This is especially true when it comes to sales and use tax determination, eInvoicing, and VAT compliance and reporting, since requirements are vastly different in every jurisdiction a company operates. The move to HANA gives companies the opportunity to consolidate, eliminating local configurations in favor of a global strategy. Companies that proactively plan can help to ensure that the next 15 years are simplified, without the constantly changing configurations needed in the previous 15 years as governments have gone digital.

Take Action

With an upcoming migration to SAP HANA, businesses must consider a solution that maintains SAP as the central source of the truth while keeping pace with constant regulatory change. Learn how Sovos is helping companies do just that, safeguarding the value of their HANA implementation here.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.

Author

Sovos

Sovos is a leading global provider of software that safeguards businesses from the burden and risk of modern tax. As governments and businesses go digital, businesses face increased risks, costs and complexity. The Sovos Intelligent Compliance Cloud is the first complete solution for modern tax, giving businesses a global solution for tax determination, e-invoicing compliance and tax reporting. Sovos supports 5,000 customers, including half of the Fortune 500, and integrates with a wide variety of business applications. The company has offices throughout North America, Latin America and Europe. Sovos is owned by London-based Hg. For more information visit http://www.sovos.com and follow us on LinkedIn and Twitter.
Share This Post

EMEA IPT
June 26, 2019
HRMC Launches Consultation on the Operation of Insurance Premium Tax

Her Majesty’s Revenue & Customs (HMRC) – the UK Government department responsible for the collection of taxes – is undertaking a call for evidence to understand how the administration and collection of Insurance Premium Tax (IPT) can be modernised and how it can address emerging practices that may lead to unfair tax outcomes. The aim […]

E-Invoicing Compliance
June 24, 2019
Indian GST Council Confirms Plan to Roll out B2B E-invoicing System

Last week, the Indian GST Council convened for its 35th session, this time chaired by the recently appointed finance minister, Nirmala Sitharaman. As expected, the topic of a nationwide mandatory B2B e-invoicing system was on the agenda, and the GST council confirmed two important principles: Scope: The e-invoicing system will cover only B2B transactions to […]

E-Invoicing Compliance Tax Compliance
June 20, 2019
Is India on a Path toward Mandatory B2B E-invoicing?

As more and more countries across the world depend on VAT, GST or other indirect taxes as the single most significant source of public revenue, governments are increasingly asking themselves what technical means they can use to ensure that they maximize the collection of the taxes due under the new tax regimes. India is the […]

E-Invoicing Compliance EMEA Italy VAT & Fiscal Reporting
June 20, 2019
From E-invoicing to E-ordering: New Mandate Coming to Italy in October

Italy has been at the forefront of B2G e-invoicing in Europe ever since the central e-invoicing platform SDI (Sistema di Interscambio) was rolled out and made mandatory for all suppliers to the public sector in 2014. While a number of its European neighbors are slowly catching up, Italy is continuing to improve the integration of […]

EMEA VAT & Fiscal Reporting
June 19, 2019
SAF-T – Where Are We Now?

Anyone who has been closely following SAF-T announcements over the past few years may be forgiven for thinking that it all seems rather like Groundhog Day.  Commencement dates and reporting requirements have been announced and subsequently amended and re-announced as the respective countries re-evaluate their needs and the readiness of companies to provide the data […]