Tax Rate Variance

Hi Expert,

This is up-gradation from 11.5.10.2 to 12.2.4.

In 11i, All AP taxes have been defined as Non-recoverable tax.

Business doesn't have any tax amount in PO but in invoice they have tax amount. Receipt is also accrued. They used to get the tax expense account in invoice level.

But in R12, it hits tax rate variance in the invoice level for the same scenario above. There are metalink notes 872354.1, 2041443.1 & 1460811.1 available to explain the logic to derive tax rate variance. (due to difference between PO and Invoice, it picks IPV in tax rate variance).

This is European customer. They would like to follow the same behavior as in 11i. They expect system to hit tax expense account like 11i,