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<ManualTopic ID="/baanerp/tc/onlinemanual/000428" xml:lang="en">
   <Header>
      <Title>To define tax exceptions</Title>
      <Keyword type="header" order="d1e1443750">
         <Level1>Tax</Level1>
         <Level2>tax exceptions</Level2>
      </Keyword>
   </Header>
   <GeneralSection>
      <Paragraph>For situations in which the derived tax code is incorrect, you
		can define tax exceptions. A tax exception is a set of transaction details for
		which you define a tax code and tax country and business partner tax country
		other than the values that result from the standard tax code or tax country
		derivation.</Paragraph>
      <Paragraph>For example, if you want to use a specific tax code for purchase
		transactions with a specific ship-from country and delivery terms, you can
		define a tax exception.</Paragraph>
      <Note>
         <SectionTitle>Note</SectionTitle>
         <Paragraph>If you set up <Link href="/baanerp/tc/glossary/glossary#000401" role="glossary">withholding tax</Link>, you must use this procedure to link the <Link href="/baanerp/tc/glossary/glossary#000425" role="glossary">group tax codes</Link> to the business partner <Link href="/baanerp/tc/glossary/glossary#000424" role="glossary">tax classifications</Link>.</Paragraph>
      </Note>
      <ProcedureList>
         <ListIntro>To define tax exceptions, take the following steps:</ListIntro>
         <ListItem>In the <GUIRef href="/baanerp/tc/tax/tctax0170m000" role="session">Company Sets (tctax0170m000)</GUIRef> session, define one or a number of <Link href="/baanerp/tc/glossary/glossary#000420" role="glossary">financial company sets</Link>.</ListItem>
         <ListItem>
            <Paragraph>In the <GUIRef href="/baanerp/tc/tax/tctax0171m000" role="session">Companies by Company Set (tctax0171m000)</GUIRef> session, add financial companies to the
			 company set. Ensure that each financial company belongs to only one financial
			 company set.</Paragraph>
            <Paragraph>To define the tax exceptions for a single financial company,
			 create a company set that contains only one company.</Paragraph>
         </ListItem>
         <ListItem> 
            <List>
               <ListIntro>For the financial company set, define the tax exceptions
				in one of the following ways:</ListIntro>
               <ListItem>For individual countries, use the <GUIRef href="/baanerp/tc/tax/tctax1100m000" role="session">Tax Exceptions by Country (tctax1100m000)</GUIRef> session.</ListItem>
               <ListItemHead>
                  <GUIRef href="/baanerp/tc/tax/tctax1101m000" role="session">Tax Exceptions by Country Set (tctax1101m000)</GUIRef>
               </ListItemHead>
               <ListItem> 
                  <List>
                     <ListIntro>If the tax exception applies to several countries, use
					 the <GUIRef href="/baanerp/tc/tax/tctax1101m000" role="session">Tax Exceptions by Country Set (tctax1101m000)</GUIRef> sessions.</ListIntro>
                     <ListItem>First, in the <GUIRef href="/baanerp/tc/tax/tctax0120m000" role="session">Country Sets (tctax0120m000)</GUIRef> session, define <Link href="/baanerp/tc/glossary/glossary#000350" role="glossary">tax country sets</Link> and in the <GUIRef href="/baanerp/tc/tax/tctax0121m000" role="session">Countries by Country Set (tctax0121m000)</GUIRef> session, add countries to the tax country
					 set.</ListItem>
                     <ListItem>Next, run the <GUIRef href="/baanerp/tc/tax/tctax1101m000" role="session">Tax Exceptions by Country Set (tctax1101m000)</GUIRef> session to define the tax exceptions for
					 the country set.</ListItem>
                  </List>
               </ListItem>
            </List>
         </ListItem>
         <ListItem> 
            <List>
               <ListIntro>In the <GUIRef href="/baanerp/tc/tax/tctax0100m000" role="session">Tax Parameters (tctax0100m000)</GUIRef> session, select the following details:</ListIntro>
               <ListItemHead>
                  <GUIRef href="/baanerp/tc/tax/tctax0100m000#tctax000.telv" role="manual">Tax Exempt Level</GUIRef>
               </ListItemHead>
               <ListItem>Select the method you use to define <Link href="/baanerp/tc/glossary/glossary#TaxExempt_tc" role="glossary">tax exemptions</Link>. If you do not define tax exemptions, select <GUIRef href="/baanerp/tc/domains/tax.telv#limited" role="option">Limited</GUIRef>.</ListItem>
               <ListItemHead>
                  <GUIRef href="/baanerp/tc/tax/tctax0100m000#tctax000.sro1" role="manual" Update="No">Search Order</GUIRef>
               </ListItemHead>
               <ListItem> 
                  <List>
                     <ListIntro>Select one of the following values:</ListIntro>
                     <ListItem>In one of the <GUIRef href="/baanerp/tc/tax/tctax0100m000#tctax000.sro1" role="manual" Update="No">Search Order</GUIRef> fields, select <GUIRef href="/baanerp/tc/domains/tax.src1#exception" role="option">Exceptions by Country</GUIRef> or <GUIRef href="/baanerp/tc/domains/tax.src1#exception.set" role="option">Exceptions by Country Set</GUIRef>, as applicable.</ListItem>
                     <ListItem>If, in addition to the tax exceptions, you define tax
					 exemptions, you must also select <GUIRef href="/baanerp/tc/domains/tax.src1#exemptions" role="option">Exemptions by Country</GUIRef> or <GUIRef href="/baanerp/tc/domains/tax.src1#exemptions.set" role="option">Exemptions by Country Set</GUIRef> in a <GUIRef href="/baanerp/tc/tax/tctax0100m000#tctax000.sro1" role="manual" Update="No">Search Order</GUIRef> field.</ListItem>
                  </List>
               </ListItem>
            </List>
         </ListItem>
         <ListItem>Use the <GUIRef href="/baanerp/tc/tax/tctax8100m000" role="session">Test Tax Model (tctax8100m000)</GUIRef> session to test the resulting tax code and tax country
		  in various situations, and make the necessary adjustments.</ListItem>
      </ProcedureList>
   </GeneralSection>
   <RelatedTopics>
      <SectionTitle>Related topics</SectionTitle>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000452" role="manual">To set up tax exemptions</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000440" role="manual">To test the tax model</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000317" role="manual">Value added tax (VAT)</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000105" role="manual">Sales tax</Link>
      </RelTopic>
   </RelatedTopics>
</ManualTopic>