Tax & Compliance
Calculate net tax liability, manage filing lifecycles, and keep VAT, withholding, and corporate tax reconciled across every Finance module.
Overview
Tax & Compliance is the consolidation point for everything tax-related across TotalApp's Finance modules. Instead of re-entering figures, it automatically pulls output VAT from posted invoices in Invoicing & Billing, input VAT from vendor bills in Expenses & Budget, and withholding tax from processed Payroll Logistics batches, then computes your Net Tax Liability for the period.
Net Tax Liability Formula
Net Tax Liability = Output Tax − Input Tax. Output Tax is the VAT you charged customers on posted sales invoices; Input Tax is the VAT you paid on vendor bills and is deductible against it. Withholding tax collected via payroll is tracked and reported separately alongside this figure, since it is remitted rather than netted.
The screen is organized into five tabs — Overview & KPIs, Declarations & Filings, Tax Ledgers & Reconciliation, Tax Rates & Rules, and Audit & Compliance Log — covering everything from a first glance at your current position to the full audit trail behind every figure.
The Five Tabs
| Tab | What it does |
|---|---|
| Overview & KPIs | Snapshot of Net Tax Liability, output/input VAT totals, withholding collected, and a sync status panel for every connected Finance module. |
| Declarations & Filings | The list of tax declarations moving through the filing lifecycle, from first calculation to payment confirmation. |
| Tax Ledgers & Reconciliation | Line-by-line ledger of every tax-bearing transaction (invoices, bills, payroll batches) feeding into a declaration, with reconciliation status against the GL. |
| Tax Rates & Rules | The Tax Rate & Jurisdiction Matrix — defines tax types, rate codes, percentages, and the GL accounts each maps to. |
| Audit & Compliance Log | Immutable, timestamped record of every manual adjustment, status change, and anomaly flag, with CSV export for external auditors. |
Overview & KPIs
The first tab gives a real-time snapshot of your tax position for the selected period:
- Net Tax Liability — Output Tax minus Input Tax, the headline figure for the period.
- Output VAT — total VAT charged on posted invoices, pulled live from Invoicing & Billing.
- Input VAT — total deductible VAT paid on vendor bills, pulled live from Expenses & Budget.
- Withholding Tax Collected — totals sourced from processed Payroll Logistics batches.
A module sync status panel shows whether each connected module — Invoicing & Billing, Expenses & Budget, Payroll Logistics, Fixed Asset Management, and Accounting & Cash Flow — has synced successfully, is pending, or has a data gap that needs attention before you calculate a declaration.
Cross-Module Integration
Tax & Compliance does not collect data manually — it reads directly from the modules that already generate tax-relevant transactions elsewhere in Finance:
| Source Module | What it feeds into Tax & Compliance |
|---|---|
| Invoicing & Billing | Output VAT — the tax charged to customers on every posted (confirmed) sales invoice. |
| Expenses & Budget | Input VAT — the deductible tax paid on approved vendor bills. |
| Payroll Logistics | Withholding tax — the amounts withheld from employee pay in each processed payroll batch. |
| Fixed Asset Management | Sync status only — flags capital purchases that may carry input VAT or special depreciation-linked tax treatment for review. |
| Accounting & Cash Flow | Sync status and GL posting reference — confirms tax entries reconcile against the general ledger. |
If a source module has not synced (for example, an invoice batch not yet posted), the affected figures are flagged as provisional on the Overview tab until the underlying module catches up.
Declarations & Filings
Every tax declaration for a period moves through a five-stage lifecycle. Stages are one-directional — you cannot move a filing backward once it advances:
| Stage | Meaning |
|---|---|
| Draft | A new declaration shell for the period, before any figures have been pulled or calculated. |
| Calculated | Output tax, input tax, and net liability have been computed from the connected modules' data. |
| Under Review | The calculated figures are being checked internally before submission — anomaly flags should be resolved here. |
| Submitted | The declaration has been filed with the relevant tax authority; the figures are now locked. |
| Paid | Payment against the submitted declaration has been confirmed; the filing is closed. |
Marking a filing Submitted locks its calculated figures — any correction after this point must be made through a manual adjustment on a new declaration, never by editing a submitted one, to preserve the audit trail.
Tax Ledgers & Reconciliation
This tab lists every individual transaction — invoice, vendor bill, or payroll line — that feeds into a declaration's totals, alongside its reconciliation status against the general ledger in Accounting & Cash Flow. Use it to trace a declaration's headline number back to the exact source transactions, or to investigate why a figure looks off before moving a filing to Under Review.
Each ledger line supports a manual tax adjustment when a transaction was recorded incorrectly upstream. Every adjustment requires a mandatory reason and is written permanently to the Audit & Compliance Log — adjustments cannot be made anonymously or without justification.
Tax Rates & Rules — the Jurisdiction Matrix
The Tax Rate & Jurisdiction Matrix is the configuration layer behind every calculation. It maps a tax type and rate code combination to a percentage and a GL account:
| Dimension | Values |
|---|---|
| Tax Types | VAT, Withholding, Corporate, Excise |
| Rate Codes | Standard, Reduced, Zero-rated, Exempt, Reverse Charge |
Each tax type / rate code pair carries its own percentage and posts to a specific GL account, so a Standard-rate VAT transaction and a Reduced-rate VAT transaction can be tracked and reported separately even though both are VAT. Reverse Charge entries are recorded at 0% net cash impact but still tracked for reporting completeness, matching standard reverse-charge VAT treatment.
Changing a rate does not retroactively rewrite history
Editing a rate code's percentage in the matrix only affects transactions calculated after the change. Already-Calculated or Submitted declarations keep the rate that was in effect when they were computed — this is intentional and mirrors how real tax rate changes are applied going forward, not backward.
Anomaly Detection
Before you move a declaration to Under Review, the module runs an automatic anomaly check across the ledger lines feeding it and surfaces two common data-quality issues:
Missing Customer Tax IDs
Flags posted invoices where the customer record has no tax identification number on file — required for a valid VAT declaration in most jurisdictions.
Unverified Vendor Tax Status
Flags vendor bills where the vendor's tax registration has not been verified, which can affect whether input VAT is legitimately deductible.
Flagged items appear as warnings on the Declarations & Filings tab and in the Audit & Compliance Log. Resolving them is not mandatory to submit, but unresolved flags remain visible on the filing's record permanently.
Audit & Compliance Log
Every manual tax adjustment, filing status change, and anomaly flag is written to an append-only log with a timestamp and the acting user. Nothing in this log can be edited or deleted after the fact — it exists specifically to answer "who changed what, and why" during an external audit.
Click Export CSV at the top of the tab to download the full audit trail as a CSV file suitable for handing directly to an auditor or importing into a compliance tracking tool.