There's a configuration option to display the calculated VAT to users. This option is turned on by default for may countries. This can cause confusion as many people do not understand the mathematics used to calculate the tax and are confused by the results of the calculation.
This lesson aims to clear up some of this confusion. We'll use a common expense to work through an example: A German user entering a domestic taxi expense for €50.
Note
Short, domestic taxi trips are taxed at 7% in Germany. Concur Expense will calculate the VAT to be €3.27. At first glance, this number does not make sense to many users.
How was that number derived? How do you apply a 7% tax to a €50 expense and get €3.27? Shouldn't it be €3.50? (€50 * .07)? These are common questions, and there is a simple two-step formula you can use to calculate the tax yourself:
Step 1: Expense Amount / (1 + Tax %) = Net Amount
Step 2: Expense Amount - Net Amount = Tax Amount
If you're clever with arithmetic and have a calculator, you can combine the two steps into a single formula, but for our training, we're going to keep them separated.
- Step 1: Expense Amount / (1 + Tax %) = Net Amount
50 / 1.07 = 46.73
- Step 2: Expense Amount - Net Amount = Tax Amount
50 - 46.73 = 3.27
There are also a number of websites you can use to help with calculating VAT. None of these are built by, owned by, or sponsored by SAP Concur, and SAP Concur cannot vouch for the results, but they're a quick way to check your math. A simple internet search for "VAT Calculators" will bring up several results.
Now that you know how to calculate VAT, let's start learning how the SAP Concur system is configured to calculate VAT. We'll start by taking a high-level look at the screens involved in configuring VAT.