Every company trading within the European Union is required by law to ensure that the VAT numbers of its customers are correct for supplies within the EU. Failure to provide proof, for example via an extract of the VIES database, could result in serious consequences to your company’s VAT position.
Master Data Creation
Typically, when Master data is created in SAP, the Master data team visits the VIES Website to check the VAT number manually in the VIES database. An extract is stored in the Master data backup files which concludes the process. However, at any given moment you may be requested by the Tax Authority to provide proof that the VAT number once entered into your SAP system, is still correct. Most companies do not have the time, resources or the processes in place to check all their Master data records manually, multiple times per year.
Tytho VAT Number Validation
With Tytho VAT number validation you are able to execute the VAT number check within SAP. Thus eliminating the need to separately access the VIES website when you are required to check the VAT numbers of your customers.
There are three ways the Tytho VAT number validation can be used:
- Live check at Master Data creation: Tytho VAT number validation has been designed to check the VAT numbers when a VAT number is added to the customer or vendor master data. A real time link to VIES is made to validate the entered VAT number.
- Periodic check: Besides the check during the creation of a vendor or customer, which is already a timesaver, it is also possible to run a Tytho VAT number validation report. In this report it is possible to select a range of customers and vendors. For this range the data in SAP is compared with the VIES database. It will check if the VAT number is valid, if the company name in SAP matches the company name in VIES and last, but not least, it will check if the legal address matches. If the VAT number is correct but the address data is different this can be immediately updated in the master data. As previously mentioned, merely conducting the check will not be enough to fulfill the requirements by the Tax Authority. You are required to provide actual proof that you have conducted the check and the outcome of it. Therefore, the result of the check is stored in SAP to ensure that you have a proper audit trail. For further work processes, the results can be downloaded, to Excel for example.
- Check embedded in the transactional process: Based on your requirements, the check can also be included in the transactional process, for example during invoice creation. If a valid VAT registration number is required but not found in the VIES database, the process can be amended based on your requirements, for example, charge domestic VAT or block the invoice.
In short, Tytho can provide a custom-made solution for the whole process around VAT number validation, making your process run more efficient, as well as ensuring total compliance. Sound interesting?
For more information, or a demo on Tytho VAT number validation or any other featured product, please contact us to begin the conversation!