<?xml version="1.0" encoding="utf-8"?>
<ManualTopic ID="/baanerp/tc/onlinemanual/000367" xml:lang="en">
   <Header>
      <Title>Tax registration in a foreign country - concepts</Title>
      <Keyword type="header" order="d1e1455544">
         <Level1>Tax registration</Level1>
      </Keyword>
   </Header>
   <GeneralSection>
      <SectionTitle>Departments</SectionTitle>
      <Paragraph>For tax registration, the legal entity to which a department
		belongs is important. How a legal entity is reflected in ERP Enterprise depends on how you
		model the enterprise. You can define a legal entity as a financial company or
		as a <Link href="/baanerp/tf/glossary/glossary#GroupCompan_tf" role="glossary">financial company group</Link>.</Paragraph>
      <Paragraph>A branch office is a department situated in one country that
		belongs to a legal entity based in another country.</Paragraph>
      <Paragraph>For example, an enterprise with a legal entity in Denmark can
		have a branch office in Finland which in its turn belongs to the legal entity
		in Denmark. In this case, the company must have a tax number for the branch
		office in Finland. For transactions that are taxable in Finland, the sales
		office can use the tax number of the branch office in Finland because the two
		departments belong to the same legal entity.</Paragraph>
      <Note>
         <SectionTitle>Note</SectionTitle>
         <Paragraph>Departments in various countries that belong to the same legal
		  entity can use each other's tax numbers for transactions that are taxable in
		  the other department's country.</Paragraph>
      </Note>
      <List>
         <ListIntro>To support tax registration and reporting in foreign
		  countries, two types of department are linked to the transactions:</ListIntro>
         <ListItemHead>The administrative department</ListItemHead>
         <ListItem>The department that creates and maintains the order and which
		  determines details such as the order number series, the price book, the rates,
		  and various default values for the orders. The administrative department is a
		  sales office, a purchase office, or a service department.</ListItem>
         <ListItemHead>The financial department</ListItemHead>
         <ListItem>The department that determines the financial company to which
		  the transaction must be posted and which is responsible for the tax declaration
		  in the <Link href="/baanerp/tc/glossary/glossary#000337" role="glossary">tax country</Link> of the order. The financial company's home
		  country must be the tax country of the order. The financial department is an <Link href="/baanerp/tc/glossary/glossary#000334" role="glossary">accounting office</Link> of the financial company.</ListItem>
      </List>
      <Note>
         <SectionTitle>Note</SectionTitle>
         <Paragraph>If the financial company of the administrative department has
		  a tax number in the tax country of the order, the financial department is the
		  same department as the administrative department.</Paragraph>
      </Note>
      <GeneralSection>
         <SectionTitle>The financial data of the order</SectionTitle>
         <Paragraph>ERP Enterprise retrieves the financial details of an order or invoice such as the currency
		  rates, various tolerances, and tax details, from the financial company of the
		  financial department on the order header. By default, the tax country is the
		  home country of the financial company of the financial department.</Paragraph>
         <Paragraph>You can only change the financial department of an order
		  header or line manually. If the financial department changes, ERP Enterprise changes the
		  financial details according to the setup of this data in the financial company
		  of the new financial department. Manually entered currency rates on the order
		  header are overwritten and, if required, you must enter the rates again. The
		  currency rate and rate factor of the order header apply to all the order lines.</Paragraph>
         <List>
            <ListIntro>For details about how ERP Enterprise handles sales
			 quotations, sales orders and service orders that are taxable in other
			 countries, refer to:</ListIntro>
            <ListItem> 
               <Link href="/baanerp/tc/onlinemanual/000370" role="manual">Tax registration in a foreign country - sales orders</Link>.</ListItem>
            <ListItem> 
               <Link href="/baanerp/tc/onlinemanual/000371" role="manual">Tax registration in a foreign country - service orders</Link>.</ListItem>
         </List>
      </GeneralSection>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Goods transfer relationships</SectionTitle>
      <Paragraph>For issues and receipts in <GUIRef href="/baanerp/wh" role="package">Warehousing</GUIRef>, ERP Enterprise checks the goods
		transfer relationship between the warehouse and the financial department of the
		order to determine the invoicing type of the goods transfer. If the order
		involves a legal entity in a foreign country, the financial department of the
		order is an <Link href="/baanerp/tc/glossary/glossary#000334" role="glossary">accounting office</Link>.</Paragraph>
      <List>
         <ListIntro>To support tax registration in foreign countries in a
		  multicompany environment, you can define relationships between the following
		  types of entities:</ListIntro>
         <ListItem>Warehouse and accounting office</ListItem>
         <ListItem>Accounting office and sales office</ListItem>
         <ListItem>Purchase office and accounting office</ListItem>
         <ListItem>Accounting office and accounting office</ListItem>
      </List>
      <Paragraph>For details, refer to <Link href="/baanerp/tc/onlinemanual/000325" role="manual">Goods transfer relationships</Link>.</Paragraph>
   </GeneralSection>
   <RelatedTopics>
      <SectionTitle> Related topics</SectionTitle>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000366" role="manual">Tax registration in a foreign country</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000372" role="manual">Tax registration in a foreign country - general rules</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000370" role="manual">Tax registration in a foreign country - sales orders</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000371" role="manual">Tax registration in a foreign country - service orders</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000368" role="manual">To set up tax registration in a foreign country</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000369" role="manual">Example of tax registration in a foreign country</Link>
      </RelTopic>
   </RelatedTopics>
</ManualTopic>