OCR and Accounts Payable
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      How to Manage Taxes with OCR

      Learn how to use OCR to fill out all your taxes automatically.

      TABLE OF CONTENTS

      How to Manage Taxes with OCR-Recognition

      Precoro streamlines tax recognition by using OCR to automatically identify and apply taxes to relevant items on invoices. 

      How it works:

      1. Upload the document for recognition.
      2. OCR identifies the tax items in the document.
      3. If a Tax item is already created in the Catalog, it will be added as the Tax type once recognized.
      4. If taxes are disabled for your company, enabling "Enter Tax as One Line" in the OCR configuration allows taxes to be added as a single item line.
      5. If taxes are enabled and the OCR recognizes only the Tax Amount (without labels for the Tax Rate), it will be added as a separate line item.

      Key points on how OCR recognizes Taxes:

      • Taxes are applied only to recognized items. If taxes aren't recognized for certain items, they won’t be recorded. However, you can manually add them if needed.
      • OCR-recognized taxes override any default taxes set in the Supplier profile.
      • With the single-line functionality enabled, recognized taxes will be calculated based on the Net Total and added to the document.
      • OCR tax recognition is consistent across all suppliers and applies to all Precoro documents.
      • Tax items are identified by keywords during OCR processing and automatically assigned a “Tax” type.

      To learn more about managing taxes in Precoro, please follow this link.

      Handling Tax Rate Mismatches

      When you create an invoice from an OCR attachment, sometimes the tax rate in the document may not exactly match your existing tax rates (for example, if there are similar tax rates or no match at all). In this case, Precoro will highlight the tax rates detected in the OCR document. You can then choose the correct tax rate or create a new one and link it to the OCR-recognized rate.

      How to Add Taxes Directly to the Document

      Precoro allows you to add taxes directly within the document, so you don’t need to navigate to settings and back. 

      Here is how to add taxes to the document:

      1. Click the Taxes field and select Add New Tax at the top of the drop-down menu.
      2. Enter the tax information and click Save.
      3. The newly added tax will now be available for selection in the list.

      For more details on creating taxes in Precoro, refer to this article.

      Precoro also uses OCR to recognize tax rates directly from documents. It maps the OCR-recognized tax values to your existing rates in Precoro and automatically fills the Tax Rate field. Additionally, the system applies the default tax for the supplier in Standard, Service, Blanket PO per Item, and Total document types.