Global Compliance

Operating across multiple countries requires compliance with various tax regimes, regulatory requirements, and local business practices. NetSuite OneWorld provides tools to manage these complexities.

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Tax Configuration by Country

Tax Engine Options

NetSuite Tax Engines
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OPTION 1: Legacy Tax (Built-in)
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  • Basic tax calculation
  • Manual tax code setup
  • Good for simple requirements
  • No automatic rate updates

OPTION 2: SuiteTax
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  • Advanced tax engine
  • Automatic rate updates (some regions)
  • Complex tax scenarios
  • Better audit support
  • Recommended for OneWorld

OPTION 3: Tax Integration (Third-Party)
─────────────────────────────────────────────────────────────────────────────
  • Avalara, Vertex, etc.
  • Real-time rate calculation
  • Comprehensive compliance
  • Address-based taxation
  • Best for high complexity (US multi-state, EU VAT)

Country-Specific Tax Setup

Tax Configuration Examples
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UNITED STATES:
─────────────────────────────────────────────────────────────────────────────
  Tax Type:         Sales Tax (origin/destination based)
  Nexus:            State-by-state registration
  Rates:            Varies by state/county/city
  Filing:           State-level returns
  Integration:      Recommend Avalara for multi-state

  ┌─ US Tax Setup ──────────────────────────────────────────────────────────┐
  │ Subsidiary: USA Operations                                              │
  │ Tax Nexuses:                                                            │
  │   ☑ California (registered)                                             │
  │   ☑ Texas (registered)                                                  │
  │   ☑ New York (registered)                                               │
  │   ☐ Florida (not registered)                                            │
  └─────────────────────────────────────────────────────────────────────────┘

UNITED KINGDOM:
─────────────────────────────────────────────────────────────────────────────
  Tax Type:         VAT (Value Added Tax)
  Standard Rate:    20%
  Reduced Rate:     5% (energy, children's car seats)
  Zero Rate:        0% (food, books, children's clothing)
  Filing:           Quarterly VAT returns
  MTD:              Making Tax Digital compliance

  ┌─ UK VAT Setup ──────────────────────────────────────────────────────────┐
  │ Subsidiary: UK Operations                                               │
  │ VAT Number: GB123456789                                                 │
  │ Tax Schedules:                                                          │
  │   • S - Standard (20%)                                                  │
  │   • R - Reduced (5%)                                                    │
  │   • Z - Zero Rated (0%)                                                 │
  │   • E - Exempt                                                          │
  │   • RC - Reverse Charge                                                 │
  └─────────────────────────────────────────────────────────────────────────┘

GERMANY:
─────────────────────────────────────────────────────────────────────────────
  Tax Type:         MwSt (Mehrwertsteuer / VAT)
  Standard Rate:    19%
  Reduced Rate:     7%
  Filing:           Monthly/Quarterly
  EU Compliance:    OSS, Intrastat

  ┌─ Germany VAT Setup ─────────────────────────────────────────────────────┐
  │ Subsidiary: Germany Operations                                          │
  │ VAT Number: DE123456789                                                 │
  │ Tax Schedules:                                                          │
  │   • DE-S - Standard (19%)                                               │
  │   • DE-R - Reduced (7%)                                                 │
  │   • DE-RC - Reverse Charge                                              │
  │   • EU-ICG - Intra-Community Goods                                      │
  │   • EU-ICS - Intra-Community Services                                   │
  └─────────────────────────────────────────────────────────────────────────┘

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VAT/GST Management

VAT on Cross-Border Transactions

EU Cross-Border VAT Rules
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SCENARIO 1: B2B Sale (UK to Germany)
─────────────────────────────────────────────────────────────────────────────
  Seller: UK Subsidiary (VAT registered)
  Buyer: German Company (VAT registered)

  Treatment: Reverse Charge
  • UK Invoice: Zero-rated (0%)
  • German Buyer: Self-assesses VAT (19%)

  UK Invoice:
    Net Amount:     £10,000
    VAT @ 0%:       £0 (Reverse Charge)
    Total:          £10,000
    Note: "Reverse charge - VAT to be accounted for by recipient"

SCENARIO 2: B2C Sale (UK to German Consumer)
─────────────────────────────────────────────────────────────────────────────
  Seller: UK Subsidiary
  Buyer: German Individual (no VAT number)

  Treatment: OSS (One-Stop Shop) if over threshold
  • Charge German VAT rate (19%)
  • Report via UK OSS return

  Invoice:
    Net Amount:     £100
    VAT @ 19%:      £19 (German rate)
    Total:          £119

SCENARIO 3: Import (Non-EU to EU)
─────────────────────────────────────────────────────────────────────────────
  Seller: USA Subsidiary
  Buyer: German Subsidiary

  Treatment: Import VAT + Customs
  • USA Invoice: No VAT (export)
  • German Import: Pay Import VAT + Customs Duty
  • German Sub: Reclaim Import VAT as input VAT

Withholding Tax

Withholding Tax Configuration
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COMMON WITHHOLDING SCENARIOS:

1. Service Payments to Non-Residents
─────────────────────────────────────────────────────────────────────────────
   Germany pays US consultant: 15% WHT (per tax treaty)

   Invoice: $10,000
   WHT: $1,500 (withheld by Germany)
   Net Payment: $8,500

2. Dividend Payments
─────────────────────────────────────────────────────────────────────────────
   UK Sub pays dividend to Parent: 0-15% WHT (treaty dependent)

3. Interest Payments
─────────────────────────────────────────────────────────────────────────────
   Intercompany loan interest: May have WHT implications

NETSUITE SETUP:
─────────────────────────────────────────────────────────────────────────────
  ┌─ Vendor Record ─────────────────────────────────────────────────────────┐
  │ Vendor: US Consulting Inc                                               │
  │ Country: United States                                                  │
  │                                                                         │
  │ Tax Information:                                                        │
  │   Tax ID (W-8BEN):        [12-3456789              ]                   │
  │   Withholding Tax Rate:   [▼ 15% - US Treaty Rate  ]                   │
  │   WHT Tax Code:           [▼ WHT-US-15             ]                   │
  └─────────────────────────────────────────────────────────────────────────┘

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Statutory Reporting

Country-Specific Reports

Country	Report	Frequency	Description
UK	VAT Return	Quarterly	Box 1-9 VAT summary
UK	EC Sales List	Quarterly	EU B2B sales listing
Germany	UStVA	Monthly	VAT pre-registration
Germany	Intrastat	Monthly	EU trade statistics
France	CA3	Monthly	VAT return
USA	1099	Annual	Vendor payments
USA	Sales Tax Returns	Varies	State-specific

VAT Return Example

UK VAT Return (Quarterly)
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Period: Q4 2025 (Oct - Dec)

┌─────────────────────────────────────────────────────────────────────────────┐
│  BOX   │ DESCRIPTION                           │ AMOUNT (GBP)             │
├────────┼───────────────────────────────────────┼──────────────────────────┤
│  1     │ VAT due on sales                      │ £45,000                  │
│  2     │ VAT due on acquisitions (EC)          │ £2,500                   │
│  3     │ Total VAT due (1 + 2)                 │ £47,500                  │
│  4     │ VAT reclaimed on purchases            │ £28,000                  │
│  5     │ Net VAT to pay (3 - 4)                │ £19,500                  │
│  6     │ Total sales (ex VAT)                  │ £225,000                 │
│  7     │ Total purchases (ex VAT)              │ £140,000                 │
│  8     │ Total EC supplies (ex VAT)            │ £15,000                  │
│  9     │ Total EC acquisitions (ex VAT)        │ £12,500                  │
└────────┴───────────────────────────────────────┴──────────────────────────┘

Filing: Via MTD-compatible submission
Due: 7th of second month following quarter end

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Localization Features

Country-Specific Editions

NetSuite SuiteCloud Editions
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Each subsidiary can use a country-specific edition:

USA Edition:
  • 1099 reporting
  • State tax nexus management
  • ACH payment formats
  • US GAAP compliance

UK Edition:
  • MTD for VAT
  • Bacs payment format
  • UK bank reconciliation
  • Companies House integration

Germany Edition:
  • DATEV export
  • German invoice requirements
  • SEPA payments
  • GoBD compliance

Japan Edition:
  • Consumption tax
  • Japanese invoice format
  • Zengin payment format
  • Japanese fiscal year

Invoice Requirements

Invoice Compliance by Country
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GERMANY (GoBD Compliance):
─────────────────────────────────────────────────────────────────────────────
  Required on Invoice:
  ☑ Sequential invoice number
  ☑ Invoice date
  ☑ Seller name, address, VAT ID
  ☑ Buyer name, address
  ☑ Buyer VAT ID (if B2B)
  ☑ Quantity and description
  ☑ Unit price and total
  ☑ VAT rate and amount
  ☑ Tax point date (if different)

UK (VAT Invoice):
─────────────────────────────────────────────────────────────────────────────
  Required on Invoice:
  ☑ Unique invoice number
  ☑ Date of issue
  ☑ Date of supply (if different)
  ☑ Seller name, address, VAT number
  ☑ Customer name, address
  ☑ Description of goods/services
  ☑ Total excluding VAT
  ☑ VAT rate and amount
  ☑ Total including VAT

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Transfer Pricing Compliance

Documentation Requirements

Transfer Pricing Documentation
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OECD GUIDELINES - Three-Tier Documentation:

TIER 1: Master File
─────────────────────────────────────────────────────────────────────────────
  • Group organizational structure
  • Description of business
  • Intangibles overview
  • Financial activities
  • Financial and tax positions

TIER 2: Local File (per country)
─────────────────────────────────────────────────────────────────────────────
  • Local entity info
  • Related party transactions
  • Comparability analysis
  • Transfer pricing method selection
  • Financial information

TIER 3: Country-by-Country Report (CbCR)
─────────────────────────────────────────────────────────────────────────────
  • Revenue by jurisdiction
  • Profit/loss before tax
  • Tax paid and accrued
  • Capital and retained earnings
  • Number of employees
  • Tangible assets

NETSUITE SUPPORT:
─────────────────────────────────────────────────────────────────────────────
  • Intercompany transaction tracking
  • Transfer pricing margin reports
  • Subsidiary-level P&L
  • Intercompany price lists (documented)

Arm's Length Principle

Transfer Pricing Methods in NetSuite
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METHOD 1: Comparable Uncontrolled Price (CUP)
─────────────────────────────────────────────────────────────────────────────
  Compare IC price to third-party transactions

  NetSuite: Compare IC Sales Orders to External Sales Orders
  Report: Price comparison by customer type

METHOD 2: Cost Plus
─────────────────────────────────────────────────────────────────────────────
  Cost + appropriate markup = transfer price

  NetSuite: Track item costs, apply consistent markup
  Report: IC margin analysis vs. target markup

METHOD 3: Resale Minus
─────────────────────────────────────────────────────────────────────────────
  End sale price - appropriate margin = transfer price

  NetSuite: Track resale price, calculate target IC price
  Report: Resale margin analysis

METHOD 4: Transactional Net Margin (TNMM)
─────────────────────────────────────────────────────────────────────────────
  Compare net profit margin to comparables

  NetSuite: Subsidiary P&L, operating margin analysis
  Report: Net margin by subsidiary

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Audit Trail and Retention

Data Retention Requirements

Country	Retention Period	Documents
USA	7 years	Tax records, financial statements
UK	6 years	VAT records, invoices
Germany	10 years	Tax records, invoices (GoBD)
France	10 years	Accounting records
Japan	7-10 years	Tax and corporate records

NetSuite Audit Features

Audit and Compliance Features
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SYSTEM NOTES:
─────────────────────────────────────────────────────────────────────────────
  • Every record change logged
  • User, date, old value, new value
  • Cannot be deleted or modified
  • Searchable via saved search

TRANSACTION AUDIT TRAIL:
─────────────────────────────────────────────────────────────────────────────
  • Full history of transaction changes
  • GL impact history
  • Approval workflow history
  • Email/communication log

PERIOD LOCKING:
─────────────────────────────────────────────────────────────────────────────
  • Lock closed periods
  • Prevent backdated entries
  • AR/AP period locks
  • Full period close

DATA EXPORT:
─────────────────────────────────────────────────────────────────────────────
  • SuiteQL data extraction
  • Saved search exports
  • ODBC connectivity
  • Archive for retention

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Common Compliance Scenarios

Scenario 1: EU B2B Transaction

EU Intra-Community Sale
═══════════════════════════════════════════════════════════════════════════════

UK Subsidiary sells to German Customer (B2B):

TRANSACTION SETUP:
─────────────────────────────────────────────────────────────────────────────
  Customer: German GmbH
  Customer VAT: DE987654321 (validated)
  Ship To: Germany

INVOICE:
─────────────────────────────────────────────────────────────────────────────
  Item: Widget-A × 100
  Net: £10,000
  VAT: £0 (Zero-rated - Intra-Community Supply)
  Total: £10,000

  Invoice Note: "Intra-Community supply of goods.
                 Reverse charge applies.
                 Customer VAT: DE987654321"

UK REPORTING:
─────────────────────────────────────────────────────────────────────────────
  VAT Return Box 6: Include £10,000
  VAT Return Box 8: Include £10,000
  EC Sales List: Report sale to DE987654321

GERMAN CUSTOMER REPORTING:
─────────────────────────────────────────────────────────────────────────────
  Self-assess VAT: €11,500 × 19% = €2,185
  Input VAT claim: €2,185 (net zero effect)

Scenario 2: Import with Customs

Import from Non-EU Country
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Germany Subsidiary imports from USA:

PURCHASE ORDER:
─────────────────────────────────────────────────────────────────────────────
  Vendor: USA Manufacturing Corp
  Currency: USD
  Amount: $50,000
  Incoterms: DDP (Delivered Duty Paid)

IMPORT PROCESSING:
─────────────────────────────────────────────────────────────────────────────
  Goods Value: €46,000 (converted)
  Customs Duty (5%): €2,300
  Import VAT Base: €48,300
  Import VAT (19%): €9,177

  Total Landed Cost: €48,300 + €9,177 = €57,477

GL ENTRIES (Germany):
─────────────────────────────────────────────────────────────────────────────
  Dr. Inventory                €48,300
  Dr. Input VAT (Recoverable)  €9,177
      Cr. Accounts Payable             €46,000
      Cr. Customs Duty Payable         €2,300
      Cr. Import VAT Payable           €9,177

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Best Practices

Area	Recommendation
Tax Setup	Engage local tax advisors for each country
VAT Validation	Always validate customer VAT numbers
Documentation	Maintain transfer pricing documentation
Retention	Follow longest applicable retention period
Audit Trail	Never disable system notes
Updates	Monitor tax rate changes quarterly

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Related Documentation

• Subsidiary Management - Country-specific subsidiary setup
• Multi-Currency Operations - Currency and FX management
• Cross-Subsidiary Transactions - Intercompany with tax implications
• Consolidated Reporting - Multi-country reporting