OASIS Tax XML Technical Committee

[November 11, 2002]   OASIS Members Form Tax XML Technical Committee.    A new OASIS 'Tax XML' Technical Committee is being formed to "focus on developing a common vocabulary that will allow participants to unambiguously identify the tax related information exchanged within a particular business context. The Tax XML TC will begin by creating a framework for ongoing development of a robust Tax vocabulary, the XML artifacts and a repository for managing these definitions, and documentation. It is expected that a subset of the overall tax information arena will be selected for the greatest return on investment and will be expanded as appropriate. Eventually, it is expected that working groups and possibly additional TCs will be formed to address an expanded scope of tax information... Tax XML will rely heavily on incorporating the XML standards that are defined for the common business vocabulary. Since tax related information spans many business interests and is mostly either an extension of common business documents or a repackaging of business information for tax compliance documents, any existing or in progress standards for business information will be examined and incorporated as appropriate. It is expected that this coordination and collaboration will be conducted with XBRL (The Extensible Business Reporting Language), and other leading initiatives as needed."

• Announcement 2002-11-11: "OASIS TC Call For Participation: Tax XML TC."
• "OASIS Members Form Tax XML Technical Committee." Press release 2002-12-09.
• Tax XML TC website
• "OASIS TAX XML TC: XML Position Paper for Tax Administrations." Version 1.0. June 2004. 34 pages.

Tax Information Group for ECommerce Requirements Standardization (TIGERS)

[November 15, 2001]   TIGERS Work Group Releases Draft XML Schemas for Electronic Income Tax Submission.    Several working committees in the TIGERS XML Work Group have developed draft XML schemas relating to "an XML-based tax data submission process for use by all state and federal tax authorities." The US Tax Information Group for ECommerce Requirements Standardization (TIGERS) work group has been chartered "to discuss matters relating to business standards and practices surrounding national tax data formatting and transfer; it develops and maintains tax electronic technical format standards for a variety of tax filing and other related government electronic reporting or data exchange applications." The TIGERS project web site provides public access to draft schemas for IRS Form 1120 (140 XML schema files) and for Form 1120S (Subchapter S Corporation). IRS Form 1120 for US Corporate Income Tax Return was initially selected for the pilot because it represents approximately 85% of the data elements for IRS filings, and has significant overlap with the Individual Income Tax Form (1040). The IRS 1120, 1120S, and 941 schemas are now being reviewed, supported by a listserver; ongoing work includes the development of IRS Form 1041, 1065, and 990 XML schemas. Working committees have also prepared a draft 'eFile Transport and Packaging Proposal' which "outlines a method for enveloping XML data designed to provide utility in securing, receiving, routing, and processing files; the intent of the exercise is to determine how best to package for transmission and subsequent processing XML-format 941s, 1120s, and other transactions." [Full context]

See:

• "Tax Information Group for ECommerce Requirements Standardization (TIGERS).
• "TIGERS Workgroup Reviews Draft XML Schemas for Form 1120 Corporation Income Tax Returns." News item 2002-04-04.

UK Inland Revenue

[February 14, 2002]   UK Inland Revenue Internet Service Technical Pack Provides XML Schemas for Tax Software Developers.    The latest release of the '2002 Internet Service Technical Pack for Software Developers' from the UK Inland Revenue contains some sixteen (16) XML schemas and other documentation relevant to the development of software for the electronic submission of 2001/02 Tax Returns over the Internet. This pack is one of several containing XML schemas; financial agents, payroll bureaux and other intermediaries are now able to send a number of PAYE forms over the Internet on behalf of their clients who are employers. XML schemas are available for EB5 PAYE forms (P6, P6B, P9) and for PAYE 'In Year'. An online Y2002 Internet Test Submission Service has also been provided to software developers to test the validity of XML submissions under the internet service; these include IR-PAYE-EOY (2002 End Of Year submissions); IR-PAYE-EXB (2002 Expenses and Benefits submissions); IR-PAYE-STARTER (2002 Movements P46 and P45[3] submissions); IR-PAYE-LEAVER (Movements P45[1] submissions); IR-PAYE-PENNOT (2002 Pension Notification submissions); IR-PAYE-UPDATE (2002 Works Number Update submissions); IR-PAYE-DOM (2002 Domestic schemas P12, P37). This UK Inland Revenue Electronic Business activity parallels similar schema development work being done in the US by the Tax Information Group for ECommerce Requirements Standardization (TIGERS). [Full context]

Inland Revenue XBRL Working Group

Through the Inland Revenue XBRL Working Group, the IR has made a substantial commitment to "using XBRL as the component of Corporate Tax filings. XBRL will be used because the bulk of a corporate tax filing is taken up with statutory accounts and what is called the 'computation', i.e., the derivation that goes from the statutory accounts and includes adjustments, calculations, depreciation calculations, etc. IR and the vendors are committed to a timeline for adopting XBRL filings so as to avoid an indefinite period in which 'electronic filing' of this data is nothing more than PDF and other file attachments... The IR has looked seriously at the business case for electronic filing [not merely taking a paper process and moving it as-is to electronic form] -- looking at the broader context of what's good for filers, vendors, and tax administrators, and others..." [adapted from a communiqué of Walter Hamscher]

• UK XBRL taxonomy; Taxonomy schema for XBRL (extends the W3C XSchema schema with several linking structures useful for XBRL taxonomies); XBRL schema for Company Tax Return, Form CT600.
• "Inland Revenue CT E-Filing. The Business Case for XBRL." By PricewaterhouseCoopers and Walter Hamscher (Standard Advantage). 12 pages. Revision 1, 20-December-2001. "The UK government has made a broad and deep commitment to establishing a sound technical foundation for e-Government. Within this framework, there is a requirement for standardising data tags and vocabularies across government departments. CT e-Filing is an Inland Revenue initiative that will allow corporate entities to file form CT600 electronically using Extensible Markup Language (XML), along with XML Schema, which defines the arrangement of XM L data in a file. This builds on similar XML implementations for SA and PAYE forms. To that end, the Inland Revenue development team has created a standardised set of data tags and structures for representing the CT600 in XML. This was released for consultation to tax and accounting software vendors on 22-November-2001. In the commercial world, over 120 software vendors, accounting firms, and users of financial data have formed an independent consortium in order to standardise the data tags and vocabularies for business reporting, using XML and XML Schema for the same reasons that the Inland Revenue chose to do so. The resulting specification is the eXtensible Business Reporting Language (XBRL) and the community is XBRL.org. What XBRL adds to XML Schema is a framework for defining financial and business performance terms to be used consistently within and across many different software applications. The terms have a fixed meaning, defined and endorsed by professional associations and independent of any particular software application. The framework then allows those terms to be organized in any given business form or report along dimensions that are common in reporting: business entities, the period of reporting, and classification with respect to the type of each data item. Furthermore, XBRL is accompanied by a growing number of vocabularies covering large areas of accounting and financial data -- a core set of UK accounting concepts being among those vocabularies..." [from the author]
• XBRL Symposium for Tax Filings
• Electronic Form 990 Data Transfer Demonstration. Form 990: "Return of Organization Exempt From Income Tax." Uses XBRL, an XML specification for reporting of business information. "The purpose of the demo is to demonstrate how XBRL/XML could be used in a proposed 'Form 990 Electronic Reporting System (FERS)' for annual reporting and registration with state charity offices. This would reduce costs for entering data and to others who make use of Form 990 information, such as the National Center for Charitable Statistics and GuideStar/PRI."
• "IR CT6000 Tax Form for U.K. Commercial and Industrial Companies." A Taxonomy for the creation of XML-based instance documents for CT6000 filing of businesses according to Inland Revenue. Used XBRL Specification dated 2000-07-31. "This documentation explains the XBRL Taxonomy IR CT600 Tax Form for U.K. Commercial and Industrial Companies, dated 2000-03-12. This taxonomy is created compliant to the XBRL Specification, dated 2001-03-12. It is for the creation of business tax CT600 form filing with the Inland Revenue in compliance with its revenue code..."
• "General Electric Implements enumerate Software To Streamline Financial Reporting." - "Software developer enumerate Solutions, Inc. today announced that the Corporate Tax Department of General Electric, the world's eighth largest corporation, has signed a contract to use enumerate's software tool -- the XBRL Creator -- to simplify and speed its tax reporting processes. GE will use enumerate's technology to more efficiently coordinate and consolidate financial information from its global subsidiaries. 'GE's federal tax return -- running more than 40,000 pages -- is the largest return received by the Internal Revenue Service (IRS),' said Steve Francis, Director of Tax Systems at GE. 'To generate the return, we must gather and evaluate information from over 150 distinct general ledgers, each with its own financial system. It's both time consuming and error-prone.' XBRL Creator, based on the new reporting standard known as eXtensible Business Reporting Language (XBRL), will now allow GE to streamline its tax reporting processes..."
• See: "Extensible Business Reporting Language (XBRL)."

TAX eXtensible Markup Language (TaXML)

TaXML is said to be/provide "an open, XML-based standard for the global exchange of tax related information." Send requests for information to administrator@taxml.org. [To be] launched January 30, 2002 or later.

[2002-01-21] Note from Michael Roytman (Vertex Inc.): "TaXML organization, represented at http://www.taxml.org, which is in process of development and will be available next week [2002-01-27], is an organization promoting the development of open, XML-based standard for the global exchange of tax related information. Vertex Inc., as an organization in the tax domain, has been working on TaXML for a number of years and is ready to collaborate with other participants in the tax compliance process. This initiative is not associated with Microsoft Corp[oration's Tax Markup Language (TaxML) endeavor], however we do invite software vendors and solution providers to participate and contribute to the development of TaXML..."

Contact: Michael Roytman (email: Michael_Roytman@vertexinc.com; tel" +1 (610) 640-4200). Or send email to administrator@TaXML.org.

Tax Markup Language (TaxML)

TaxML is noted as a proposed XML vocabulary in documents from Microsoft.

• "An Open Standard for Tax Data Interchange Using TaxML." Microsoft Business 'E-Gov' web site. January 22, 2001. "One of the great benefits of the Internet is the development of open standards that allow heterogeneous systems to interoperate. Because of this, Internet users can exchange information using dissimilar e-mail, networking, directory and operating systems. Web-based technologies and standards, such as the markup languages HTML and XML, empower them to conduct their business more efficiently and successfully... The Tax Markup Language (TaxML) is a proposed vocabulary defined using XML specifically for tax data. As such, it allows clear identification of tax items by using terminology drawn from the discipline of taxation. The authors that created the tax data hierarchy are tax professionals with many years of commercial tax software development experience. Much thought and effort has been invested into making a substantive start on the huge project of standardizing tax data using XML. The work represented by TaxML is only a starting point for government, the tax industry, and the software industry to use, as the XML strategy is pursued. In addition, government and the tax industry will probably adopt Extensible Style Language (XSL) style sheets as well..."
• "Tax Administrations Lead the Way To Provide High Quality Online Public Service." Microsoft 'Public Sector' [E-government to people] web site. May 2001. "... As a subset of XML, the Tax Markup Language, or TaxML, defines a way to format tax information so that the many heterogeneous systems within and outside tax administrations, including legacy systems, can capture, transmit, and store data consistently. The open TaxML vocabulary allows clear identification of tax items by using terminology drawn from the discipline of taxation. The authors that created the tax data hierarchy are tax professionals with many years of commercial tax software development experience. Much thought and effort has been invested into making a substantive start on the huge project of standardizing tax data using XML... Terry Lutes of the Internal Revenue Service, which has the most frequently visited public sector web site in the United States, believes XML is the new industry standard for data exchange. He says it will ease tax compliance and lower costs for taxpayers, and result in shorter audit cycle times, fewer errors and reduced costs for validating returns. It will also make for easier transitions when there are tax changes. 'We're not about using technology to do things the way we did in the past,' says Lutes. 'The question is how to do business with the technology we've got and to rethink the fundamentals.' The IRS has started work on developing TaxML schema directly from Microsoft's work on XML and from that done for state sales tax. The state of California is using a similar approach, and standards are being developed by the Tax Information Group for EC Requirements Standardization (TIGERS), which consists of the IRS, state governments, service providers, industry and other interested parties involved in taxation and finance. Meeting six times annually, the TIGERS group aims to create guidance useful to government tax authorities to assist them in contractor or in-house XML application development. It is examining a variety of tax filing types (personal income, sales, motor fuel, corporate income, etc.), together with new and informed thinking about how to represent these in XML..."

IRS (US Internal Revenue Service)

[May 05, 2003]   IRS Modernized e-File Team Releases New XML Schemas for Corporate Income Tax.    A posting from Barr Joan (US IRS Modernized e-File Team) announces the release of new XML schemas governing the e-filing of income tax information for US corporations. The distribution includes some 750 new XML schema files used by tax preparation software developers and tax preparers in automated e-filing and validation of IRS forms data. The schemas cover TY2002 1120 forms, including the Production Release Version 1.0 (53 forms) and Candidate Release Version 2.0 (43 forms). IRS Form 1120 "is used to report the income, gains, losses, deductions and credits, and income tax liability of a corporation. All domestic corporations (including corporations in bankruptcy) must file whether or not they have taxable income. IRS Form 1120S is used to report income, deductions gains, losses, etc., of a domestic corporation that has elected to be an S corporation by filing Form 2553, Election by a Small Business Corporation, and whose election is in effect for the tax year and until terminated. The IRS is vigorously designing an electronic filing process for Forms 1120 and 1120S under the IRS e-file program. The 1120/1120S e-file program is scheduled to begin in January 2004. Upon completion, the 1120 program will have file and pay capability and returns will be processed on a transaction basis rather than in batch mode. Any business taxpayer who files Form 1120/1120S may e-file their return through an Authorized IRS e-file provider." In January 2003 the IRS began accepting XML-based electronic filing for the 94x series, including Form 940 (federal unemployment taxes) and Form 941 (employers' quarterly federal taxes).

A number of XML schemas have been developed for use in the IRS Tax e-file system. See the references that follow, including the main reference document.

References: [if the links below are broken, access http://www.irs.gov/ and use the Search facility to locate XML-related documents]

• XML General 1120/1120S Schema Information
• 94x XML Developers' Forum
• 94x XML User Guides and Publications
• 94x XML Assurance Testing Scenarios
• Fed/State Employment Tax XML Forum
• "US Internal Revenue Service and SGML/XML for Tax Filing" - Main reference document.

QuickBooks Extensible Markup Language (qbXML)

The XML DTDs used in the 'QuickBooks Extensible Markup Language' (qbXML) have many elements for tax-related information. This application illustrates the need to formally model "tax-related" information within the broader scope of government jurisdictions which levy taxes, and in concert with financial/ledger/accounting models that are part of corporate and personal concern.

See references in "QuickBooks Extensible Markup Language (qbXML)."

Open Applications Group Integration Specification (OAGIS)

OAGIS is an example of an XML-based e-business application that necessarily addresses tax-related information in message transaction definitions. OAGIS version 7.2.1 provides (1) 60 Collaboration Definitions; (2) Support for SOAP, ebXML, RNIF, BizTalk; (3) 201 XML Message Definitions; (4) XSD and DTD Support. This is actually the 16th release, some seven (7) years in maturing. Ongoing content projects include supply chain execution; product development collaboration; invoice settlement; shopping cart; party ID enhancements; warranty; PO contracts; financial services.

Appendix F in the Open Applications Group Integration Specification [OAGIS] version 7.2.1 contains a description of how to properly use the TAX and DISTRIBUTN Data Types in a Business Object Document (OAGIS BOD). A revision effort required the addition of a Tax Data Type for the Sync Salesorder BOD and for each BOD having a CHARGE Data Type. For OAGIS version 6.x, "Taxes are handled differently for each of these two types of documents. (1) Financial Documents: For financial documents such as Receivables and Payables, the tax information is handled on the line on the document, thus obviating the need for a separate TAX Data Type. The tax lines on the receivables or payables document are identified by the Field Identifier TAXLINE. The use of the TAXCODE Field Identifier is used to identify a description or a possible tax table. The General Ledger information for the taxes in this case are contained on the line of the financial document itself or within the DISTRIBUTN Data Type attached to the line. (2) Operations Oriented Documents: For the operations oriented documents such as Purchase Order and Sales Order, the taxes are handled by adding the Charge Data Type to the header and lines of the document. This Data Type currently does not contain any General Ledger information such as GL Nominal Account or Cost Center..." See references in "Open Applications Group."