SuiteTax and India localization Overview

Co-author: Sansdeep Gill

NetSuite SuiteTax is a global tax management solution seamlessly integrated into the NetSuite ERP platform, catering to the diverse tax requirements of multinational global organizations. Tailored for efficiency in every jurisdiction, SuiteTax ensures compliance with local tax regulations, offering features for GST, VAT, and other indirect taxes worldwide.

It is sophisticated tax engine which automates complex tax calculations, simplifies return filing, and optimizes Input Tax Credit management, providing real-time updates to navigate ever-evolving global tax landscapes. SuiteTax’s unified cloud-based architecture replaces legacy tax systems, ensuring scalability and customization for diverse business needs. With its intuitive interface and advanced reporting capabilities, SuiteTax empowers global enterprises with accurate, real-time insights, consolidating financial operations and fostering compliance across borders.

Prerequisites:

 Before Installing the Indian Localization Suite tax following are the prerequisites:

1. Submit a SuiteTax enablement request – The Sutietax Feature must be approved and provisioned for the Netsuite Instance in order to install the India Localization Engine SuiteApp.
2. Enable the SuiteTax feature and Confirm completion of SuiteTax setup – In NetSuite.
3. Enable the SuiteCloud features – In NetSuite, under (Setup > Company > Enable Features). On the SuiteCloud subtab, check the following boxes
   1. Custom Records
   2. Custom Transactions
4. Create sales and purchase accounts – The sales and purchase accounts are required to use the taxation features such as GST and TDS.
5. Set up a tax agency for a nexus – Set up the correct tax agencies for all your nexuses before you create a transaction.

After completing the prerequisites, install the bundles in the following order:

India Localization Suite Tax Engine (Bundle ID : 253246)

Suite Tax Reports (Bundle ID : 237699)

India Localization Suite tax Reports (Bundle ID : 255126)

Note: The information of the State, Province, and County fields of the address is required to determine the correct Place of Supply and Inter/Intra-State tax for India GST. It is necessary to disable the ‘Allow Free-Form States’ in Addresses preference (Set up –> Company –> General Preferences) before setting India GST to prevent any errors during the calculation of tax.

Enable NetSuite India SuiteTax Engine Plug-in :  After installation of three bundles listed above, the next step is to enable India SuiteTax Engine Plugin.

Navigation:

Go to Customization àPlug-ins à Manage Plug-ins

Features and Gaps focused on India:

While NetSuite SuiteTax is designed to address various tax compliance requirements, it’s important to note that the specifics of tax regulations and compliance can be intricate and subject to frequent changes. As of my last knowledge update in January 2022, there may be certain aspects of India’s tax compliance that might not be covered comprehensively by NetSuite SuiteTax.

Following example explain features and limitations of SuiteTax from India localization perspective:

Highlight of SuiteTax India localization features:

1. GST Compliance:
   • SuiteTax is expected to provide robust support for Goods and Services Tax (GST) compliance in India, including accurate calculation, reporting, and adherence to various GST rates.
2. GST Return Filing:
   • SuiteTax likely includes features for generating GST returns in the prescribed format, streamlining the filing process for businesses in India.
3. Reverse Charge Mechanism:
   • SuiteTax may handle transactions falling under the reverse charge mechanism, ensuring proper tax calculation and compliance.
4. Input Tax Credit (ITC) Management:
   • SuiteTax should offer functionality for managing Input Tax Credit on purchases, allowing businesses to offset their tax liabilities.
5. E-way Bill Integration:
   • Integration with E-way bill generation may be part of SuiteTax, facilitating compliance with transportation-related tax regulations.
6. TDS (Tax Deducted at Source):
   • SuiteTax is likely designed to manage the calculation and reporting of Tax Deducted at Source for applicable transactions.

India Localization SuiteTax Reports:

The India Localization SuiteTax Engine is free and managed SuiteApp that reflects the enhancement automatically when new features and enhancements are added.

India Localization SuiteTax Reports is developed by NetSuite for accounts that use the India Localization SuiteTax Engine. India Localization Suite Tax Reports enables users to generate Tax Deduction at Source (TDS) and India Goods and Services Tax (GST) reports.

Supported Features

Generate Tax Deduction at Source (TDS) Tax Reports:

• Income Tax Form 26Q

• Income Tax Form 27Q

Generate India Goods and Services Tax (GST) Reports:

• GSTR1

• GSTR3B

• Purchase Register

Note: The topics under this section are for NetSuite accounts where the SuiteTax feature is enabled. For accounts without SuiteTax, see Legacy Tax.

Limitations:

1. Local Tax Variations:
   • NetSuite SuiteTax is built to handle national-level taxes such as GST. However, there might be variations in local taxes or municipal taxes that are not fully covered.
2. Industry-Specific Requirements:
   • Certain industries might have specific tax requirements or exemptions that are not universally addressed by SuiteTax.
3. Customized Reporting:
   • While SuiteTax provides robust reporting capabilities, businesses with highly specialized reporting needs may find it challenging to create entirely custom reports within the system.
4. Real-Time Adjustments:
   • Rapid and unexpected changes in tax laws may require businesses to make real-time adjustments. Depending on the frequency and nature of these changes, there could be limitations in how quickly SuiteTax can adapt.
5. Specific Regional Rules:
   • Some regions within India may have specific tax rules or exemptions that SuiteTax might not cover comprehensively.
6. Custom Workflows:
   • Highly specialized business processes or workflows related to taxation may require customization beyond the standard capabilities of SuiteTax.

Summary:

It’s crucial for businesses to stay updated on country specific localization and compliance requirements as well as latest SuiteTax feature updates which can address those requirements. Additionally, for highly specialized or unique requirements, businesses may need SuiteTax subject matter expert like RSM global consultants.  It is important to stay UpToDate on NetSuite SuiteTax and its coverage country specific compliance features. It is recommended to consult and consider the assistance of tax professionals familiar with Indian tax regulations.

To learn more about NetSuite SuiteTax or how you can get started leveraging it, contact the RSM team!

Pawan Singh

Pawan offers 8 years of versatile experience, including 3 years specializing in NetSuite implementations across various verticals, with a strong grasp on modules ranging from Order to Cash to CRM, and excels in cutover strategies and data migration. His recent success in enhancing customer satisfaction in the manufacturing, wholesale, and retail sectors underscores his adept use of NetSuite to meet diverse industry needs.