Tax Intelligence Suite

Tax Intelligence Suite verifies incoming invoices against VAT compliance requirements. It ensures all legally mandated fields are present and accurate, validates VAT IDs against the issuer’s address, and performs arithmetic checks on all stated amounts. Beyond formal validation, the AI matches invoice data with the corresponding purchase order to ensure consistency of tax-relevant details. The entire process is fully automated and AI-powered within SAP,  eliminating the time spent on manual invoice reviews and preventing excessive VAT reclaims.

Automated determination of the appropriate General Ledger (G/L) account on line item level for invoices and validation of the corresponding VAT treatment for each transaction. Using a combination of AI-driven document analysis and tax rule evaluation, the solution extracts relevant information from invoices, purchase orders, contracts, and supporting documents to understand and classify the goods and services and identify the correct accounting and VAT treatment. In case of sufficiently high confidence, the posting to the G/L and VAT accounts determined can be fully automated. By ensuring that VAT is posted consistently and accurately at source, the solution minimizes posting errors, prevents discrepancies between VAT reporting and G/L postings, reduces manual review efforts and strengthens financial and tax compliance across high-volume transactional processes.

Tax Intelligence Suite screens incoming invoices to identify any services subject to withholding tax on a line item basis. For this purpose, master data and other related documents such as licensing contracts can be considered in the background to provide decisive information on which invoices are potentially relevant. Once a relevant transaction is identified, the applicable withholding tax category and treatment is determined based on transaction details, supplier information, historical treatments and other supporting documentation. Specialized AI agents also assess applicable exemptions based on double tax treaties or exemption certificates and support consistent tax treatment across jurisdictions. The solution can be used independently or in combination with the extended withholding tax functionality in SAP to cover the existing limitations and gaps. The automated process reduces compliance risks due to missed withholdings, prevents under- or over-withholding, and significantly decreases the manual effort required for withholding tax reviews.

By leveraging Generative AI, the solution analyses invoices, receipts, General Ledger (G/L) postings or other supporting documents to extract and classify tax-relevant information and assess the tax treatment and deductibility requirements. Based on the structured and unstructured data, tax-relevant transactions such as entertainment expenses, gifts or generally non-deductible expenses are identified and classified. In case there is not enough data to make the final assessment, the AI can indicate potentially relevant transactions and flag them for an additional manual review. The solution can also be integrated with expense management systems such as Concur or other tools to collect additional data for the financial postings or to directly perform a tax evaluation at the source. By automating the evaluation of expense categories against corporate tax rules and compliance requirements, the solution can also ensure the transactions are posted to the correct G/L accounts to  improve consistency, reduce manual assessment efforts, and automate the preparation of tax returns.

The solution uses AI for Operational Transfer Pricing by automating the setting and validation of intercompany transfer prices in line with the arm’s length principle and applicable transfer pricing policies. By analyzing intercompany agreements, invoices, cost allocations, and financial data, the solution identifies and classifies intercompany transactions by type and applicable pricing method and automatically sets the price or mark-up at Purchase Order level before it is issued. Alternative, it can be validated on invoice level whether the pricing applied is plausible and consistent with the defined transfer pricing policy and benchmarking data, flagging deviations for review. Besides leveraging GenAI, it is also possible to define a rule-based price determination in decision tables based on SKUs. In addition, the solution automates the creation of the transaction matrix by extracting and structuring relevant information on intercompany transactions by classifying and flagging transactions into the required transaction types directly in SAP and connected systems. This leads to a much higher level of automation and quality compared to a purely rule-based approach, which reduces effort, increases consistency and compliance across entities and jurisdictions and ensures that transactional data is considered for each individual case.