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What is Tax jurisdiction code?

A jurisdiction code used in countries like USA is a combination of the codes defined by TAX AUTHORITIES. Upto 4 Tax Levels could be defined below the Federal Level as folows :-

1. Sub city level
2. City level
3. Country level
4. State level

How to configure the Jurisdiction Code?

The tax jurisdiction codes represent the different taxing authorities to which you submit payment for taxes EG: the state, county, city etc. 

In SAP you can have as many as 4 levels. Configuration is done in 2 steps :

First step :
The tax jurisdiction structure (structure of the tax code) is set up with following menu path : 

IMG >Financial accounting> Fi Accounting basic settings> tax on sales/purchases > basic settings > specify structure for tax jurisdiction code.

Alternatively you can use t-code OBCO

This step allows you the enter the character length of your various level of hierarchy within your tax jurisdiction code structure (State 2 char, county 3, city 4, etc...).

Second step:

You configure the tax jurisdiction code using the structure defined earlier, menu path :

IMG >Financial accounting> Fi Accounting basic settings> tax on sales/purchases > basic settings > define tax jurisdiction codes.

Alternatively t-code  OBCP

Define your tax jurisdiction codes, EG GA0000000 for Georgia, GA001000 for Georgia, douglas county, GA001001 for georgia, douglas county, city of lithia springs.

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• Basic Interview Asked Questions For FI Applicants #1
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