Global Tax Compliance (VAT/GST/Sales Tax)

1. Goal: Automated Filing & Cross-Border Safety

Problem: VAT rules are complex. Calculating the boxes for the monthly return (e.g. UStVA in Germany) is manual and error-prone. Solution: A tax engine that validates every invoice line and automatically generates the XML/JSON payload to file directly to the Tax Authority (ELSTER, HMRC, etc.).

2. Core Value Proposition

• Validation: Stops invoices with wrong tax codes before they are booked.
• Automation: Auto-fills the boxes for the VAT Return (e.g., UK Box 1, DE UStVA Line 81).
• Direct Filing: API integration with Tax Authorities (e.g., ERiC for ELSTER).

3. Key Logic: The "Tax Determination Engine"

• Inputs:
  • Vendor Country (Origin)
  • Buyer Country (Destination)
  • Line Item Type (Goods vs Services)
  • Tax ID presence (on both sides)
• Rules:
  • EU ↔ EU (B2B): Reverse Charge applies?
  • US ↔ EU: Import VAT?
  • Domestic: Standard Rate correct?

4. Data Model

TaxRuling

• ruling_id
• invoice_line_id
• detected_regime: DOMESTIC_STANDARD | INTRA_COMMUNITY_SUPPLY | EXPORT | REVERSE_CHARGE
• expected_rate
• actual_rate_on_invoice
• status: MATCH | MISMATCH

Tax Return Submission (Filing)

• Mechanism:
  • Aggregation: Sums all TaxRuling entries by period.
  • Mapping: Maps detected_regime -> Box Number (e.g., REVERSE_CHARGE -> UStVA Kennziffer 46).
  • Submission: Generates the official XML (e.g., via ELSTER API for Germany).
  • Audit Proof: Stores the "Transmission Protocol" (Protokoll) linked to the return.

TaxReturnDraft

• period
• jurisdiction (e.g., DE, UK, US-NY)
• boxes: JSON object mapping { "Box1_Sales": 1000, "Box4_Purchases": 200 }

5. UX/UI

• The "Tax Mismatch" Inbox: "Vendor charged 19% VAT, but this is a cross-border EU service (Reverse Charge). Please request credit note."
• Filing Cockpit:
  • "Preliminary VAT Return (UStVA) - Oct 2024"
  • Status: Ready to File
  • Action: "Submit to Finanzamt" (Triggers API call).