Symptom
You get the error message "External Reference <XYZ>: Error in tax recalculation due to <ABC> <DEF> discount. Use a Payment Difference Reason that is not relevant for tax adjustment. (KBA: 3109103)" when trying to clear the Invoice and Payment manually.
Environment
SAP Business ByDesign
Reproducing the Issue
- Go to Receivables work centre.
- Click on Customer Accounts view.
- Search for the Account and Click View.
- Click on Clearing ID.
- In the next screen You find the error message - "External Reference <XYZ>: Error in tax recalculation due to <ABC> <DEF> discount. Use a Payment Difference Reason that is not relevant for tax adjustment. (KBA: 3109103)", once you click on Clear.
Cause
This occurs when the Transaction currency and the Tax Reporting Currency of the document are different. During clearing/payment, a negligible discount is applied, and the adjustment is relevant for tax recalculation.
Example:
Customer Invoice created with Transaction Currency in EUR and Tax Reporting Currency in DKK .
Exchange Rate Applied = 7.44
Base Amount | Tax(%) | Tax Amount | Gross Amount | |
Transaction Currency (EUR) | 213 | 25 | 53.25 | 266.25 |
Reporting Currency (DKK) | 1584.72 | 25 | 396.18 | 1980.9 |
During clearing/payment, when a negligible discount is applied, for example 0.01 EUR, the Tax Lines in Transaction Currency are adjusted as follows:
Transaction Currency (EUR) | |||
Base Amount | Tax(%) | Tax Amount |
Gross Amount |
213 | 25 | 53.25 | 266.25 |
212.992 | 25 | 53.248 | 266.24 |
0.002 |
The Tax Amount is then rounded off to two digits = 0.002 rounded to 0.00. Hence in the Transaction Currency, the Tax Amount = 0.00
Further, in the Reporting Currency the discount applied would be 0.01 * 7.44 = 0.0744
The Tax Lines adjusted in Reporting Currency would be:
Reporting Currency (DKK) | |||
Base Amount | Tax(%) | Tax Amount | Gross Amount |
1584.72 | 25 | 396.18 | 1980.9 |
1584.66048 | 25 | 396.16512 | 1980.8256 |
0.01488 |
The Tax Amount is then rounded off to two digits = 0.01488 rounded to 0.01. Hence in the Reporting Currency the Tax Amount = 0.01
Resolution
You have to post the discount against a Payment Difference Reason that is not tax adjustment relevant.
Keywords
Clearing, Cash Discount, Tax Deduction Correction, Tax Amount, Transaction Currency, Zero, 0 , KBA , it is not possible to post the cash disc , the cash discount as tax deduction corre , tax amount in transaction currency is 0 , error while clearing , error while approving clearing task , AP-DUE-PTD , Product Tax Declaration , Known Error