Week 2: Direct Tax

Unit 1: Introduction to Direct Tax

Introduction to Direct Tax
What is direct tax for the purpose of this course?

Direct tax
A tax, such as income tax, which is levied on the income or profits of the person/entity who pays it,
rather than on the goods or services. This is different from tax that is levied upon a transaction,
which is referred to as an indirect tax.
For the purpose of this course we refer to direct tax as a tax that is levied on organizations based
on the profits they make, for example corporate income tax.
Tax provisioning is the process of adding disclosure notes and financial figures about the tax
position into the quarterly and year end reporting both at group and local level. This involves an
estimation of taxes for the current year and adjustment for previous years, but also the value of
deferred tax assets and liabilities.
Multinational organizations are faced with increased complexity of legislation and filing
requirements. Also, new global legislation is added, which adds to the complexity. Examples being
a global minimum tax (Pillar II) and publication of key tax figures per jurisdiction (country by
country).

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Introduction to Direct Tax
Typical process challenges when dealing with direct tax

Bookkeeping and accounting

during the period Document Return to Net operating
business and provision losses
tax events Tax risk
Tax
management
return

Pillar II
IFRS tax
accounting Tax 80-90%
Cash tax
provision Same data

Process Total tax

return to IFRS
Text
contribution
provision Statutory
accounts
Prepare Country-by-
Statutory Text
country
and file
CIT return reporting
Tax

Finance
© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3
Introduction to Direct Tax
How to translate process challenges to data flow

Creation Collection / Consolidation Reports

Disclosure
IFRS Notes
Tax provisioning
solution (PAPM) Annual
LGAAP ERP statement
ERP
ERP Consolidation
(SAP
system (S/4 GR)
S/4HANA) CIT Return
TAX
Tax return software Reporting /
Analytics
(SAC)

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Introduction to Direct Tax
Example: SAP S/4HANA implementation and its relevance for direct tax

§ Legal entity reporting

§ Expense management and analysis
§ Cash tax Organizational
FI-CO Structure
§ Automation of book/tax
Assets Chart of
adjustments Depreciation Accounts
GL § Country by country
reporting Key Building
SAP S/4HANA § Pillar 2 Blocks
Universal Journal
AP/AR § Withholding taxes (Master) Data Ledgers
Fixed
Assets
Currencies
§ Tax fixed assets
§ Tax gain/losses

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Introduction to Direct Tax
Back to the beginning: why are we considering automation in the direct tax process?

Less time and fewer people available

More information to process Increased compliance and

reporting requirements

Tax
department

Wider responsibility Environment operates faster

More stakeholders

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Thank you.
Contact information:

[email protected]
Follow all of SAP

www.sap.com/contactsap

© 2024 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.

The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.

In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/trademark for additional trademark information and notices.
Week 2: Introduction to Direct Tax
Unit 2: Managing Data from ERP for Direct Tax
Managing data from ERP for Direct Tax
Typical challenges when dealing with direct tax

Bookkeeping and accounting

during the period Document Return to Net operating
business and provision losses
tax events Tax risk
Tax
management
return

Pillar II
IFRS tax
accounting Tax 80-90%
Cash tax
provision Same data

Process Total tax

return to IFRS
Text
contribution
provision Statutory
accounts
Prepare Country-by-
Statutory Text
country
and file
CIT return reporting
Tax

Finance
© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2
Managing data from ERP for Direct Tax
Building blocks – What is required from a tax perspective?

Creation Collection / Consolidation Reports

Disclosure
IFRS Notes
Tax provisioning
solution (PAPM) Annual
LGAAP ERP statement
ERP
ERP Consolidation
(SAP
system (S/4 GR)
S/4HANA) CIT Return
TAX
Tax return software Reporting /
Analytics
(SAC)

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Managing data from ERP for Direct Tax
Automating book to tax differences – Different types of rules

SAP S/4HANA

IFRS STAT Tax Deferred Share-

LEDGER LEDGER Ledger tax based
payments
Pension
Balances provisions
Adjustment Taxable
and Data
Journals income
Points Expense
(SAP rule-based calculation engine or manual)
provisions

Rule configuration
§ Type 1: G/L account
§ Type 2: G/L posting data points
§ Type 3: Formula-based

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Managing data from ERP for Direct Tax
Comparing different ledgers in SAP Fiori

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Managing data from ERP for Direct Tax
Key takeaways

§ Ledgers can be set up to capture tax data:

bookkeeping throughout the year, adjustments
or forecasting numbers
§ Setting up different ledgers for IFRS, local
GAAP, and tax enables you to automate book to
tax differences to be posted in the tax ledger
§ Note that a tax ledger is not a substitute for a tax
provisioning solution and that the process of
keeping the tax ledger up to date is crucial for its
success!

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Managing data from ERP for Direct Tax
How Asset Accounting can provide you the NBV for different accounting standards/ledgers

(Leading) ledger
chart of accounts Company code Legal entity

Chart of depreciation Country

Depreciation area Depreciation area Depreciation area

Accounts/asset Book (IFRS) Local GAAP Tax
classes
Acq Adj NBV Acq Adj NBV Acq Adj NBV
Buildings 1000 400 600 1000 200 800 1000 200 800
Machines 3500 200 3300 3500 500 3000 3500 300 3200
Equipment 4000 1000 3000 4000 1000 3000 4000 2000 2000

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Managing data from ERP for Direct Tax
Tax depreciation – What can Asset Accounting/Fixed Assets in SAP solve?

Physical
Inventory

§ Change of location
§ Inventory corrections
§ Physical inventory stock taking

Asset Periodic
Acquisition Disposal
Maintenance Processing

§ From investment project via AuC § Transfers (location/cost center) § Depreciation § Sales
§ Via direct purchasing § Reclassifications § Simulations/Forecasts § Scrap
§ Leased assets § Value adjustments § Period-end closing § Retirement
§ Donations § Year-end closing

Reporting

§ Asset history
§ AuC report
§ Depreciation
§ Disposal report
§ Property report

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Managing data from ERP for Direct Tax
High level overview of the management of an asset in SAP

Asset Company Code

CoCd 0004 0004
Asset 4711 …
… Chart of Accounts AAAA Account Determination
Class 4000 … Ch. Of Accounts AAAA
… 11000
Asset Class Deprec. Area 01 51
4000 Bal. Sheet Acct 11000 78300
… Offsetting Acct 399999 78310
Account Determ. 11000 …
… Accum. Deprec. Acct 11010 78300
Dep. Expense Acct 211100 252301
…
Retirement Clearing 825000 252301
…

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Managing data from ERP for Direct Tax
Key takeaways

§ Asset Accounting (Fixed Assets) in SAP can be

configured for tax purposes: since the master
data for assets and the acquisition booking are
already made for IFRS/local GAAP purposes,
there is a chance for tax to leverage the efforts
made and include tax depreciation logic.
§ To have the correct setup in place, tax needs to
be involved in Asset Accounting discussions.
Topics that tax could bring in are, for example:
low value assets, tax depreciation logic, asset
capitalization, accelerated depreciation, property
tax requirements, industry-specific requirements
etc.
§ SAP provides standard reports to easily
determine the book to tax differences for fixed
assets.

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Thank you.
Contact information:

[email protected]
Follow all of SAP

www.sap.com/contactsap

© 2024 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.

The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.

In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/trademark for additional trademark information and notices.
Week 2: Direct Tax
Unit 3: Managing Tax Calculations
Managing tax calculations
Typical process challenges when dealing with direct tax

Bookkeeping and accounting

during the period Document Return to Net operating
business and provision losses
tax events Tax risk
Tax
management
return

Pillar II
IFRS tax
accounting Tax 80-90%
Cash tax
provision Same data

Process Total tax

return to IFRS
Text
contribution
provision Statutory
accounts
Prepare Country-by-
Statutory Text
country
and file
CIT return reporting
Tax

Finance
© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2
Managing tax calculations
Tax accounting: ultimate goal – Paint the best picture for shareholders and investors

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Managing tax calculations
Tax accounting: ultimate goal – Paint the best picture for shareholders and investors

© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 4

Managing tax calculations
What is currently happening at multinationals?

Canada The Netherlands Russia

United
States

India

Brazil

Australia
South Africa

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Managing tax calculations
How most tax departments still spend their time

Receive, translate, and

Preparations Analysis Finalizing
reconcile Excel files

Day -2 and Day -1 Day 1 – Day 3 Day 4 – Day 5 Day 6 - 7

100%

80%

60%

40%

20%

0%
1 2 3 4 5 6 7 8 9

Manual labour Value adding activities

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Managing tax calculations
Drivers for change: main challenges for tax departments

§ Robust tax control frameworks § Tighter reporting deadlines

§ Country-by-country reporting § Automation becomes necessity
§ Demand for standardization and ‘best in class’ § Gathering high-quality data which can be analyzed
disclosures § Base erosion and profit shifting & transfer pricing
§ Late adjustments and consolidation Drivers
§ Auditor pressure
§ Remove key person dependency
for
§ Reducing complexity and maintenance (e.g., rolling
§ Change in regulation or new regulations and accounting
change forward or spreadsheets)
standards § Process and risk improvement
§ Internal pressures on headcount and cost savings
§ Developments in the application of finance systems

In short:

There is a burning need

Tax is currently where finance Tax still does a lot of
to change the traditional
was 15+ years ago manual work in Excel
way of working

© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 7

Managing tax calculations
How can you automate tax adjustments to increase efficiency and quality during a close?

Book to tax Automate in ERP (S/4) Automate in tax Manually / semi- Tax automation
differences accounting engine automate from (Excel) opportunities
(PAPM) workpapers § Low complexity
§ Stable legislation
Non-deductible interest
§ Few/no exceptions
Meals and § Relevant data easily available
entertainment § High volumes

Fines and penalties § No qualitative judgement

§ Configure vs build
Innovation box
calculations
Fixed assets ERP vs outside system
considerations
Intangibles § Close to source vs close to end
user
Pension liabilities
§ Tax ownership

Provisions § Configure vs build

§ Ease of maintenance
Other assets & liabilities § Fit to IT strategy

© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 8

Managing tax calculations
Key takeaways

§ The tax close is becoming increasingly complex

due to shorter timelines and increasing tax
compliance and reporting requirements, such as
Pillar 2
§ Most organizations therefore look for technology
to make processes more efficient and improve
the quality of the (reported) data
§ SAP offers products to simplify your tax
reporting process, but they need to be
configured

© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 9

Thank you.
Contact information:

[email protected]
Follow all of SAP

www.sap.com/contactsap

© 2024 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.

The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.

In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/trademark for additional trademark information and notices.
Week 2: Direct Tax
Unit 4: Managing Reporting and Analytics
Managing reporting and analytics
SAP Fiori – The renewed user interface

© 2024
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Managing reporting and analytics
Examples of relevant SAP Fiori reports for direct tax

Asset reports AP FI
§ Asset accounting overview § Accounts payable overview § Financial statements
§ Asset balances § Manage invoice list § Balance sheet
§ Asset transactions § Manage supplier line items § Display account balances
§ Asset history sheet §… § Financial statement – ledger
§ Total depreciation comparison
§… § Trial balance comparison
AR
§ G/L account balance
§ Accounts receivable overview
§…
§ Manage customer line items
§ Manage customer master data
§…

© 2024
4 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3
Managing reporting and analytics
What is SAP Analytics Cloud (SAC)?

Advanced user experience in comparison

with static reports

Interactive charts, calculated KPIs,

hierarchies, drilldown to G/L, easy
sharing, online comments, etc.

Reconciliation and traceability

© 2024
4 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 4
Managing reporting and analytics
Integration of SAP Analytics Cloud with SAP S/4HANA and other SAP products : Deloitte's View

Tax Value

Real Time SAP Analytics Cloud

Viewing data at the

source in real time

Tax Digital Boardroom

BI Planning Predictive GRC
VAT Transfer Corporate Withholding
Customs Tax Wage Tax
Analytics Pricing Income Tax

SAP Tax Compliance cloud integration by SAP

SAP Document and SAP Cloud Integration for periodic reporting

Reporting Compliance
SAP Cloud Integration for real-time reporting
SAP Profitability and Authorities
Performance Management

Central Finance Environment

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Managing reporting and analytics
Sample views/dashboards in SAP Analytics Cloud

© 2024
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Managing reporting and analytics
Sample views/dashboards in SAP Analytics Cloud

© 2024
4 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 7
Thank you.
Contact information:

[email protected]
Follow all of SAP

www.sap.com/contactsap

© 2024 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.

The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.

These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.

In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/trademark for additional trademark information and notices.
Week 2: Direct Tax
Unit 5: Base Erosion and Profit Shifting 2.0 – Pillar 2
Base Erosion and Profit Shifting 2.0 – Pillar 2
Typical process challenges when dealing with direct tax

Bookkeeping and accounting

during the period Document Return to Net operating
business and provision losses
tax events Tax risk
Tax
management
return

Pillar II
IFRS tax
accounting Tax 80-90%
Cash tax
provision Same data

Process Total tax

return to IFRS
Text
contribution
provision Statutory
accounts
Prepare Country-by-
Statutory Text
country
and file
CIT return reporting
Tax

Finance
© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2
Base Erosion and Profit Shifting 2.0 – Pillar 2
Introduction and overview: OECD Pillar One and Pillar Two

G7 political agreement
June 2021

G20 Endorsement
Pillar One July 2021
Realigning who gets to tax
§ Revision of existing profit allocation
and nexus rules
OECD Inclusive Framework Statement
October 2021
§ Removal of digital services taxes
and other relevant similar measures
OECD model rules and EU proposal
Pillar Two December 2021

Ensuring enough tax is paid

somewhere Netherlands releases draft legislation
§ A global anti-base erosion (GloBE) October 2022
proposal
§ Global minimum tax of at least 15%
§ Country by country basis Agreement reached on EU proposal
December 2022

Further guidance
2023
© 2024 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3
Base Erosion and Profit Shifting 2.0 – Pillar 2
Introducing the rules

What?
§ Global minimum tax of 15%
§ New tax system (“GloBE”)
§ Jurisdictional
§ Group revenue ≥ €750 million

How?
§ “Top-up” to a minimum rate
§ Key rules:
1. Main rule: Income Inclusion Rule (“IIR”)
2. Backstop rule: Undertaxed Payments Rule (“UTPR”)
3. Domestic top-up tax

When?
§ Income Inclusion Rule in 2024
§ Undertaxed Payments Rule in 2025
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Base Erosion and Profit Shifting 2.0 – Pillar 2
Five-step approach

1 2 3 4 5

Determine Scope Calculate GLoBE Determine Covered Calculate ETR and Apply
Income Taxes Top-Up Tax IIR and UTPR

Identify constituent Calculate GloBE Determine and allocate Calculate the effective Apply the IIR and UTPR
entities in scope by: income or loss by: the covered taxes by: tax rate and the top-up by:
1. Identifying 1. Determining financial 1. Identifying covered tax by: 1. Identifying the parent
constituent entities accounting net taxes 1. Computing liable for the top-up
2. Removing any income or loss 2. Adjusting covered jurisdictional top-up tax under the IIR
excluded entities 2. Adjusting financial taxes for temporary tax for low-tax 2. Allocating the liability
accounting net differences and jurisdictions for any residual top-
income or loss to losses 2. Allocating the top-up up tax through a
GloBE base tax UTPR adjustment

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Base Erosion and Profit Shifting 2.0 – Pillar 2
Transitional safe harbor rules

Application until fiscal years starting on or before 31 December 2026

Simplified ETR test Where the Transition Rate Is:

1 Simpli&ied Covered Tax

Pro&it Loss before Income tax
> Transition Rate
§ 15% for 2024
§ 16% for 2025
§ 17% for 2026

De Minimis test

2 § Total revenue according to qualified CbCR is less than EUR 10m; and
§ Profit (loss) before income tax (PBT) according to qualified CbCR is
less than EUR 1m.

Routine Profits test

3 Substance Based Income Exclusion (SBIE) >

Profit (Loss)before Income Tax (PBT)

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Base Erosion and Profit Shifting 2.0 – Pillar 2
Compliance

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Base Erosion and Profit Shifting 2.0 – Pillar 2
What would an architecture with SAP look like?

Creation Collection / Consolidation Reports

IFRS

Pillar 2 (PAPM) Disclosure

Notes
LGAAP ERP
ERP
ERP Consolidation Quarterly
(SAP
system (S/4 GR) Reporting
S/4HANA)
TAX
Pillar 2
Pillar 2 – filing Return

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Base Erosion and Profit Shifting 2.0 – Pillar 2
SAP Profitability and Performance Management

Proposed solution architecture for corporate income tax

SAP Analytics Cloud

Workplace Reporting

SAP Profitability and Performance

Other sources, Management
files
Domestic CIT calculations BEPS Pillar 2 E-Filing

SAP S/4HANA

General ledger Group ledger

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Base Erosion and Profit Shifting 2.0 – Pillar 2
SAP Profitability and Performance Management

Empowers business users

Define
Integrate Design Analyze
Processes Collect Enrich Enter Execute
Data Calculation and
and Data Data Data Models
Source Rules Report
Reports

Models can be configured by

business department,
IT people can focus on installation
and data integration, but don’t need
to do model calculations

Modeling Execution Analysis

User User User
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SAP Profitability and Performance Management
Implement BEPS2.0 Pillar 2 methodology in tax auditing

Objective Benefits
Efficient Reporting:
§ Gain trust by establishing a robust and Supports Country-by-Country
auditable BEPS2.0 reporting, along with Reporting (CbCR), enables
Country-by-Country Reporting. standardized system of reporting,
§ Drive action by maintaining the data, and allocation of income taxes and
giving flexibility to make adjustments for business activities on tax
the prior years data. jurisdiction-by-jurisdiction basis.

§ Determine the Effective Tax Rate and Top-

up tax against Constituent Entities that are Actionable Insights:
part of the targeted MNE group. Analyze data at a level of granularity
that allows decision making and
targeted actions for MNE groups
§ Capabilities easier. Providing simulation feature
to the clients to check and compare
§ Source and integrate data from SAP and
the impact of adjustments in the
non-SAP applications into a centralized
Effective Tax Rate.
PaPM repository.
§ Harmonize, allocate and calculate
BEPS2.0 key figures along established Enhance Tax Auditing:
structures from OECD BEPS2.0 Pillar 2 Multiple reports are created to
architecture. enhance and evaluate an MNE
§ Analyze detailed report under BEPS2.0 group tax auditing for better
In a nutshell Pillar 2 methodology in different qualitative management decisions.
Implementation of BEPS2.0 Pillar 2 methodology in new and reporting formats.
existing globalized and digitalized network. Pillar 2 aims at § Drive targeted action by giving MNE group
determining to be paid Top-up Tax by the Constituent Entities a dedicated view on their Effective Tax
under OECD rules. Rate and Top-up Tax.

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Base Erosion and Profit Shifting 2.0 – Pillar 2
Demo: PaPM

M O
DE

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Thank you.
Contact information:

[email protected]
Follow all of SAP

www.sap.com/contactsap

© 2024 SAP SE or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.

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