What is Tax Unit in
Here in this video you can see how a Tax unit can be configured as a group of VAT-taxable / GST-taxable enterprises that are legally independent of each other but are closely linked financially, organizationally, and economically and therefore considered the same GST/VAT-taxable enterprise. GST/VAT/Tax units are not mandatory, but if created, constituent companies of the unit must belong to the same country, use the same currency, and one company must be designated as the representative company of the GST/VAT/Tax unit. VAT/GST Tax units receive a specific tax ID intended only for tax returns. Constituent companies keep their tax ID used for commercial purposes.
Use Case:
Enterprise A owes €300.000,00 of GST/VAT taxes and enterprise B can recover €280.000,00 of GST/VAT taxes. They form up as a GST/VAT unit so that the two amounts balance out and must conjointly only pay €20.000,00 of GST/VAT taxes.
