Standard Process

Pre-requisites -

1. Make sure to have enough transactions with sales tax amounts
2. Remove the vendor from the tax authority, keep it blank.

Process -

1. Go to Tax module -> Declarations -> Run the declaration "Settle and Post sales tax" for the required settlement period with the Sales Tax Payment version as Original.
2. When the settlement voucher is posted, go to the voucher and reverse it.
3. Now run the Declaration again, with the Sales tax payment version as Latest Corrections.
4. System will throw the error "Original sales tax settlement has already been created for the period."

Expectations -

This error is not logical, because when we reverse the settlement voucher, the settlements become effectively 0 for that period, so running the declaration again should post a new settlement voucher. Once the settlement voucher is posted, the system closes the period for any new settlement. If that voucher is reversed, system should recalculate the settlement for the periods.

This can be further seen when we fetch the Declaration reports (Tax -> Declaration -> Report Sales Tax for Settlement Period), with the option Total Corrections, where the report will now display the original settlement amount and the reversal amount. For e.g., if the tax settlement amount was 1000, and the voucher for it was reversed, then the report will show the value as 2000.

This is a tremendous pain point for customers who might reverse the tax settlement for any reasons and wish to run the settlement again.

The TSG provided for the issue is not feasible at all, as it requires the customer to create dummy settlement periods and run backend queries everytime a settlement is reversed.

Technical details - There is a flag “reversed” in table TaxReportVoucher, there is an enum-value “TaxReversed” on enum “TaxOrigin” etc. The reversal of a tax settlement was implemented but leaves inconsistent data and wrong reports.

If this feature is implemented in upcoming versions, it will help ease the pain of many customers.