How To Fix AH632 - Tax code could not be determined

SAP Error Message - Details

• Message type: E = Error

• Message class: AH - IS-U billing (master data)

• Message number: 632

• Message text: Tax code could not be determined

What causes this issue?

A line item relevant to posting is to be generated. As part of this
process, the system determines a tax code for sub-transaction &v1&. The
tax code could not be determined.

System Response

How to fix this error?

Select a different sub-transaction, or check your Customzing settings
for tax calculation.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message AH632 - Tax code could not be determined ?

  The SAP error message AH632, which states "Tax code could not be determined," typically occurs during the processing of transactions that involve tax calculations, such as sales orders, invoices, or purchase orders. This error indicates that the system was unable to determine the appropriate tax code for the transaction based on the provided data.
  Causes of Error AH632
  
  
  Missing Tax Configuration: The tax codes may not be properly configured in the system. This includes missing tax rates or tax categories for the relevant country or region.
  
  
  Incorrect Master Data: The master data for customers, vendors, or materials may not have the necessary tax information. For example, a customer may not have a tax classification assigned.
  
  
  Inconsistent Data: There may be inconsistencies in the data entered in the transaction, such as incorrect country codes, incorrect tax jurisdiction codes, or missing information in the master data.
  
  
  Tax Determination Procedure: The tax determination procedure may not be set up correctly. This includes the rules that govern how tax codes are determined based on various criteria.
  
  
  Transaction Type: The type of transaction being processed may not be supported for tax determination, or it may require specific settings that are not in place.
  
  
  Solutions to Error AH632
  
  
  Check Tax Configuration:
  
  Go to the transaction code OBYZ (for tax codes) and ensure that the tax codes are correctly defined for the relevant country and tax type.
  Verify that the tax rates are maintained and that the tax categories are correctly assigned.
  
  
  
  Review Master Data:
  
  Check the customer or vendor master data (transaction codes XD02 for customers and XK02 for vendors) to ensure that the tax classification is correctly assigned.
  For materials, check the material master data (transaction code MM02) to ensure that the tax classification is set.
  
  
  
  Examine Transaction Data:
  
  Review the transaction data for any missing or incorrect information, such as country codes or tax jurisdiction codes.
  Ensure that all required fields are filled out correctly.
  
  
  
  Validate Tax Determination Procedure:
  
  Check the tax determination procedure settings in the configuration (transaction code OBCL). Ensure that the procedure is correctly set up to determine tax codes based on the criteria relevant to your transactions.
  
  
  
  Consult SAP Notes:
  
  Search for relevant SAP Notes in the SAP Support Portal that may address specific issues related to tax code determination.
  
  
  
  Testing:
  
  After making changes, perform test transactions to ensure that the tax code is now being determined correctly.
  
  
  
  Related Information
  
  Transaction Codes: Familiarize yourself with relevant transaction codes such as OBYZ (Tax Codes), OBCL (Tax Determination), XD02 (Change Customer), XK02 (Change Vendor), and MM02 (Change Material).
  Documentation: Review SAP documentation related to tax configuration and determination procedures for your specific version of SAP.
  Support: If the issue persists, consider reaching out to your SAP support team or consulting with an SAP expert who specializes in tax configuration.
  
  By following these steps, you should be able to identify the cause of the AH632 error and implement the necessary solutions to resolve it.