3743094 - Automatic tax code determination in purchase order (PO) creation does not function as expected

The system does not automatically determine the tax code in the Purchase Order (PO) based on whether the supplier is tax registered or not.

 SAP S/4HANA Cloud Public Edition

1. Create a purchase order for a supplier
2. Maintain the supplier’s tax type in the tax classification of the business partner
3. Observe that the expected tax code is not automatically determined and the tax code field remains blank

In SAP S/4HANA Cloud, standard tax code determination in Purchase Orders does not consider supplier tax registration status. The system derives the tax code from reference documents, info records, or condition records, and may leave it blank if none are maintained.

Implement the BAdI MM_PUR_S4_PO_MODIFY_ITEM to customize the logic. In the BAdI, check the supplier’s tax registration status and assign the appropriate tax code during PO creation.

• Refer to: KBA3020731 – Tax Code Determination in Purchase Order based on Account Assignment Category
• The tax code determination logic in the Purchase Order is explained in the SAP Note 501054 FAQ: Taxes in purchasing (See Question 1 the logic of which still applies in cloud)

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