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Lease Sales Tax Due Issue (Doc ID 2757035.1)

Last updated on MARCH 02, 2021

Applies to:

Oracle Financial Services Lending and Leasing - Version and later
Information in this document applies to any platform.


Payment allocation is not happening as per business expectation for sales tax on lease accounts.

Customer’s monthly payment contains due amount + sales tax. Whenever customer makes payment, spread is defined to collect Sales tax first. 

1.System generates billing with due amount and sales tax amount. Customer makes his monthly payment and its getting allocated to sales tax and base payment amount, as expected. since second billing not generated or as long as the payment satisfies the all the sales tax and all dues.

2.System generates billing with due amount and sales tax amount. Customer didn’t make any payment until next billing(prebill days 10). System generates next billing with due amount and sales tax amount. Customer makes payment before the next due date .

Here payment is getting allocated as below.

Sales Tax billed for date 1 + sales tax billed for date2 Lease receivable billed for date1. Due amount is collected later, leaving customer delinquent. 

The issue can be reproduced at will with the following steps:
1. Select an Lease account where sales tax is applicable and it is part of the account balance.
2. Run billing for this account(Pre bill days 10). We can see due is created and we have sales tax billed separately
3. No payment. Run billing again(prebill days is 10). Since the account did receive any payment for the previous due it will get into delinquent bucket.
4. Post a payment now, before the due date of the next billing. As per spread defined payment allocation done for sales tax first and then to the due amount.
5. Here is the problem, Customer is delinquent even though his payment satisfies the due.But since sales tax is first allocation, system deducted 2 sales tax amount and then the due.
6. Second sales tax, only billing was generated but due date is still not reached. Before that payment is made. So system should not deduct the sales tax amount for second billing from the payment made before the due date.
7. This is causing issue in customer payments.

The issue has the following business impact:
Due to this issue, users cannot service the customers where it has customer/business impact. Also will be reporting these customers as delinquent in metro 2, which is bad for customers.




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