How To Fix O5124 - No tax exemption licenses assigned to item.

SAP Error Message - Details

• Message type: E = Error

• Message class: O5 - IS-Oil: MCOE message pool

• Message number: 124

• Message text: No tax exemption licenses assigned to item.

What causes this issue?

No tax exemption license is assigned to the item.
Tax exemption licenses are only used in North America.

System Response

How to fix this error?

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message O5124 - No tax exemption licenses assigned to item. ?

  The SAP error message O5124, "No tax exemption licenses assigned to item," typically occurs in the context of sales and distribution (SD) or materials management (MM) when a tax exemption is required for a particular item, but no valid tax exemption license has been assigned to that item in the system.
  Cause:
  
  Missing Tax Exemption License: The item in question does not have a tax exemption license assigned to it in the master data.
  Incorrect Configuration: The tax exemption settings in the system may not be configured correctly.
  Customer-Specific Settings: The customer may require a tax exemption, but the necessary licenses have not been set up in the customer master data.
  Document Type Restrictions: The document type being used may not allow for tax exemptions.
  
  Solution:
  
  
  Assign Tax Exemption License:
  
  Go to the relevant item in the material master or customer master data.
  Navigate to the tax information section and ensure that a valid tax exemption license is assigned to the item or customer.
  
  
  
  Check Customer Master Data:
  
  Ensure that the customer master data has the appropriate tax exemption information filled out.
  You can do this by using transaction code XD02 (Change Customer) or VD02 (Change Customer Sales Area).
  
  
  
  Review Tax Configuration:
  
  Check the tax configuration settings in the system to ensure that tax exemption licenses are set up correctly.
  Use transaction code OBYZ to review tax codes and exemptions.
  
  
  
  Document Type Settings:
  
  Verify that the document type being used allows for tax exemptions. You may need to consult with your SAP configuration team to ensure that the document type settings are correct.
  
  
  
  Consult SAP Notes:
  
  Check for any relevant SAP Notes that may address this specific error message or provide additional guidance.
  
  
  
  Related Information:
  
  Transaction Codes: 
  
  XD02 / VD02 - Change Customer Master Data
  MM02 - Change Material Master Data
  OBYZ - Maintain Tax Codes
  
  
  SAP Documentation: Review SAP Help documentation related to tax management and exemptions for more detailed guidance.
  User Roles: Ensure that the user has the necessary permissions to make changes to master data and tax settings.
  
  If the issue persists after following these steps, it may be beneficial to consult with your SAP support team or a functional consultant who specializes in tax configuration within SAP.