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SAP AG
SAP AG 2002
Sales with VAT
Contents:
VAT Implication on Sales Process
Business Place
SD Configuration
Master Data
Sales Scenarios
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VAT Implication in Sales Processes
SAP R/3
Purchasing
Invoice
Verification
Inventory
Valuation
Delivery
VAT
Accounting
Sales Order
Billing
Utilization &
Tax Payment
VAT
impact
The areas getting affected by VAT are the sales order in which the VAT taxes
appear and the billing document where the accounts get posted. We are not covering
the VAT utilisation.
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Business Place in R/3
BUSINESS PLACE A New
Organizational Unit in Logistics
Tax Reporting entity
Defined at Company Code
Level
A new Organizational entity - Business Place (BUPLA) has been brought in use in
Logistics.
Business Place represents a Tax Reporting entity for an Organization in a state or
Region.
Business Place in R/3 will be defined at the Company Code level and will be assigned
to Plant(s).
One Business Place can be assigned to more than one Plant in a Region, but one
Plant cannot be assigned to more than one Business Place.
Business Place is currently used by SAP customers in many countries for VAT related
Tax Reporting.
Note: In India Business Place field was in use in Finance for EWT before 1st April
2003, however, 1st April 2003 onwards this field was replaced with Section Code for
EWT. Now this field is in use for Logistics.
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Business Place Assignment
Business Place is assigned to Plants
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Business Place Applicability
Business Place used for VAT related Tax reporting in
Sales and Distribution
Materials Management
Before using in Logistics, Business Place was used in Finance till 1st April 2003.
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Business Place
Entity Business Place will primarily be used for -
Defining Vat Registration Number
Determining Official Number Range for :
All Billing Transactions in SD
All Credit Memo Transactions in MM
Consolidating data for Period End Processing requirements
Determining "Alternate G/L Accounts" for Taxes
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Business Place Scenario 1
Define Single Business Place for all the Plants in a state.
Define Single Business Place for all the Plants in a state.
PLANT 1
PLANT 2
PLANT 3
# Single VAT Registration
# Consolidation for all Plants
before utilization
# Single period end process
reports for all plants
COMPANY ABC
STATE : KARNATAKA
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Business Place Scenario 2
Define Separate Business Place for both Plants in the
state.
Define Separate Business Place for both Plants in the
state.
PLANT 1
PLANT 2
VAT Registration : XXX
COMPANY ABC
STATE : KARNATAKA
VAT Registration : YYY
Output is under deferral/
exemption scheme
An Organization has two plants in one state
Output of one plant is under deferral/ exemption scheme
State Law may require separate registration number for both the plants
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Business Place Scenario 3
State specific number range requirements may be specified
Solution: Business Place is
used to determine number
range objects.
Solution: Business Place is
used to determine number
range objects.
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Business Place Scenario 4
Need for maintaining separate VAT Credit and Debit accounts for different states
Solution: Separate G/L
Accounts are maintained at
state level. Business Place is
used to determine correct
G/L account at the time of
posting.
Solution: Separate G/L
Accounts are maintained at
state level. Business Place is
used to determine correct
G/L account at the time of
posting.
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Intra State Finished goods VAT applicable Sales pricing
and Tax procedure
Sales Order Pricing
Basic Rate Rs85X 10 pcs= Rs 850
Excise Duty @20 = Rs 170
Tax Base Amount Rs 1020
VAT Rs. 102
Total Rs.1122
Pricing procedure JFACT
Condition type UTXJ
Access sequence JIND
Access Country/ Plant Region / Region/ TaxCl1Cust/ Tax Cl.Mat
Tax Code S1
Plant details
Customer master
Material master
Tax procedure TAXINJ
JIN 6
10%
VAT
10% VAT rate used for ease of representation. Actual VAT rates as per law.
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SD Configuration
Define Condition Types
IMG PathSales and Distribution Basic Functions Pricing Pricing Control
Maintain Condition Types (Transaction V/06)
New SD tax conditions are introduced for the VAT:
JIN6: A/R VAT Payable
JIN7: A/R CST Payable under VAT
JIN8: A/R CST Surcharge Payable under VAT
The condition category of these and the existing condition types should be changed
to D
These new tax conditions would need to be added to the relevant pricing procedure
and the tax procedure
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SD Configuration
Change SD Pricing Procedure
IMG PathSales and Distribution Basic Functions Pricing Pricing Control
Define and Assign Pricing Procedure (Transaction V/08)
The control parameters for JIN6, JIN7 and JIN8 would remain same as JIN2, JIN4
and JIN5 respectively
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SD Configuration
Create New Condition Table
IMG Path Sales and Distribution Basic Functions Pricing Pricing Control
Define Condition Tables (Transaction V/04)
2 condition tables are required to determine UTXJ in domestic and export sales
document: Table 368 and Table 11
Table 368 (condition table for domestic pricing) to have following fields:
ALAND: Country
WKREG: Region of delivering plant
REGIO: Region of ship-to-party
TAXK1: Customer tax classification 1
TAXM1: Material tax classification 1
Table 11 (condition table for export pricing) to have the following fields:
ALAND: Country
LAND1: Destination country
TAXK1: Customer tax classification 1
TAXM1: Material tax classification 1
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SD Configuration
Change in Access Sequence
IMG PathSales and Distribution Basic Functions Pricing Pricing Control
Define Access Sequence (Transaction V/07)
Add the condition tables 11 and 368 in the access sequence JIND
Put condition table 11 before 368, so that the system checks first if the sale is an
export or domestic
The additional accesses are used in UTXJ to determine the Output Tax Code in SD
Documents
These accesses do not use jurisdiction code and would help users to determine the
tax code when Tax Jurisdiction code is switched off
In Export Pricing Procedure also UTXJ would determine the Output Tax Code
maintained for Export
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SD Configuration
Define Condition Types (TAXINN)
IMG PathSales and Distribution Basic Functions Pricing Pricing Control
Maintain Condition Types (Transaction V/06)
New SD tax conditions are introduced for the VAT:
JVAT: A/R VAT Payable
The condition category of these and the existing condition types should be changed to D
These new tax conditions would need to be added to the relevant pricing procedure
and the tax procedure
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SD Configuration
Settings for Tax Processing (TAXINN)
IMG PathFinancial Accounting Tax on Sales and Purchases Basic Setting
Check and Change setting for tax processing (Transaction OBCN)
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SD Configuration
Define Account Keys (TAXINN)
IMG PathSales and Distribution Basic FunctionAccount
Assignment/CostingRevenue Account Determination Define and Assign
Account Keys Define Account Keys
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SD Configuration
Change SD Pricing Procedure (TAXINN)
IMG PathSales and Distribution Basic Functions Pricing Pricing Control
Define and Assign Pricing Procedure (Transaction V/08)
Condition type JVAT added
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SD Configuration
Define Business Place
SM31 Table name: J_1BBRANCV
Define a new business place
Create business place for different controlling areas
Enter the country and region for which Business Place is created
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SD Configuration
Assign Business Place to Plant
SM31 Table name: J_1BT001WV
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Alternate G/L Accounts: Introduction
To determine alternate G/L accounts for Taxes
It is used for Sales Taxes and not meant for excise posting
Helpful in reporting
Useful in maintenance of Tax Codes (input & output)
The concept of alternate G/L Account is used for LST, CST etc and not applicable to
excise related duty
This feature will help to determine alternate G/L accounts for Taxes, which will in turn
help user for reporting and maintenance of Tax Code
This functionality is available for both types of taxes (Input and Output)
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Alternate G/L Accounts: Usage
Alternate G/L account can be used in the following business processes
Determination of Separate G/L Account for VAT and Non VAT
States
Determination of Separate G/L Account for Deferral & Non-
Deferral Plants by using Business Place
Determination of Separate G/L Account for Standard and Sub-
contracting Purchases
Any other Business requirements
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Alternate G/L Accounts: Maintenance
Alternate G/L account can be maintained based on:
Chart of accounts
Business Place
Transaction Key
Tax Code
It may be created for Alternate Debit as well as credit account.
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Alternate G/L Accounts: Configuration
Note 607907 to be applied
Transaction: SM30
Table name: J_1IT030K_V
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Master Data
Plant Region
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Master Data
Tax classification
Customer
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Master Data
Tax classification Material
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Master Data
Tax code determination
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Master Data
VAT rate 12.5%
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Official Document number Configuration
Define document Class
Assign the Document class to the Sales Area and Region
Define Document Numbering
Assign the Document numbering for the Business Place
Define the Document class through SM30 in view the V_DOCCLS. For example V for
VAT and B for BOS.
Assign the VAT/BOS document class for the Plant Region and Sales Area / Document
type in the view J_1IDCLSDET.
Create the Number group in the view V_1ANUMGR1.
Create the number range through the transaction J1AB.
Assign the Document Class / Number Group / number range for the company code and
Business place in the view V_OFNUM_TW_2.
Assign the accounting document type for the Billing type in transaction VOFA.
Assign the Routine 350 at the item level of the Copying control. The transaction code is
VTFL for Delivery related and VTFA for the Order related billing.
Assign any one of the document class for Example either V VAT or B- Bill of Sales for
the country IN in the view V_T003_B_I.
You may refer the OSS note 831870 for other information.
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Official document Number Process flow
Identify the country
of the customer.
IN Export -BOS
No
Check the
Tax code in
table
J_1iexcdef
Yes
Deemed
Export - BOS
Same Tax
Code
Check the
Tax code in
table
J_1iexmptco
de
Exempted
Sales - BOS
Exempted
Tax Code
Different
Tax Code
Check the VAT
Registration No
in the Customer
Master Tax code
Field
Normal
Tax Code
Un
Registered
customers
Sales - BOS
Unregistered
Customer
Registered
customers
Sales - VAT
Yes
All the Logic for Determining the VAT or BOS has been written in the Data transfer routine 350 assigned to
the item category.
The Tax code will be determined in UTXJ condition type.
The Deemed Export tax code should be maintained in the Excise default table J_1iexcdef table. If the
determined tax code is similar in the default table then it is a Deemed export sales and the Bill of Sales
document class will be used.
The Exempted tax code can be maintained in the view J_1iexmptcode. When the system find the
determined tax code in this table then this sales will be treated as Exempted sales and Bill Of Sales
Document class will be determined.
The VAT Registration number should be maintained in the Tax code 2 field of the customer master. Please
note that the VAT Registration number provided in the standard can not be used for CIN.
For some of the state for the Unregistered Customer also the VAT Invoice should be issued. To handled
this the User exit J_1I7_CHECK_CUSTOMER_VAT can be used to change the document class as VAT.
When the Customer country is in India and the tax code determined is not Deemed export Tax code and
the tax code is not Exempted sales and the customer is Registered then VAT Document class will be
determined.
All the VAT / BOS document class for the Plant Region and Document type of the Billing and Sales area
will be maintained in the view J_1IDCLSDET.
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Organization Structure
Chart of A/c INT
Plant 1 Mumbai IN10
Maharashtra
Plant 3 Chennai IN20
Sales Area (0001/ 01/ 01)
Company Code (EWT)
VAT Reg ID 1
VAT Reg ID 2
Shipping point 0001
Shipping point 0002
Ex gp E1, Series gp S1 Domestic, S2 Exports
Ex gp E2, Series gp S3
We are doing sales from Plant IN10 only which is at Mumbai state Maharashtra
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Master Data
Material Master
MBG01 - Professional Mountain Bike with Gears
MB01 - Professional Mountain Bike without Gears
Customer Master
INC01 Mumbai Dealer
INC02 Chennai Dealer
INC08 Depot Customer for VAT
INC09 - Depot Customer for CST
G/L Accounts
VAT Payable A/c - Used for paying VAT on all sales
VAT Alternate GL A/c - Used for paying VAT on all sales
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Sales Scenarios with VAT
Followings are the scenarios with VAT
Intra State
Finished goods (VAT applicable- general VAT rates)
Finished goods (VAT exempt)
Depot sales (VAT applicable)
Inter State
Finished goods
Exports
Finished goods
Deemed Exports Finished Goods
Stock Transfer
Inter State
Intra State
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Intra State Finished goods (VAT applicable general VAT
rates)
Sales Order Pricing
Basic Rate Rs85X 10 pcs= Rs 850
Excise Duty @20 = Rs 170
Tax Base Amount Rs 1020
VAT Rs. 102
Total Rs.1122
Pricing procedure JFACT
Condition type UTXJ
Access sequence JIND
Access Country/ Plant Region / Region/ TaxCl1Cust/ Tax Cl.Mat
Tax Code S1
Plant details
Customer master
Material master
Tax procedure TAXINJ
JIN 6
12.5%
VAT
Participants can try out Finished Goods (VAT applicable with alternate G/L Accounts)
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Intra State Finished goods (VAT exempt )
Accounting documents
Accounting documents
CENVAT suspense
ED payable
Sales revenue account
Customer account
CENVAT suspense
3
Bill of Sale
4
Excise invoice
Billing
2
Shipping
Shipping
Sales Order
1
5
Period end processing
NVAT-MAT1 VAT 0%
Intra-State Customer Cus_intra1
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Intra State - Depot Sales (VAT applicable)
Mumbai Plant IN10
(Factory)
Delivery
Excise Invoice
Mumbai Plant IN 30
(Depot)
Goods Receipt
Stock in Transit
Sales Order
Goods Issue
Billing
Purchase Order
VAT Register
Updation
VAT Register
Updation
Mumbai Plant IN 30
(Depot)
VAT Register
Updation
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Inter State -Finished goods
2
Shipping
Shipping
Sales Order
1
4
Excise invoice
3
Bill of Sale
Billing
5
Period end processing
Accounting documents
Dr.Customer a/c
Cr.Sales revenue a/c
Cr.CST payable
Cr. Cenvat Suspense
Dr.CENVAT suspense
Cr. ED payable
Inter State Customer (KAR) Cus_inter1
VAT- MAT1 (VAT rate 10%)
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Exports -Finished goods
2
Shipping
Shipping
Sales Order
1
4
Excise invoice
3
Bill of Sale
Billing
5
Period end processing
Foreign Customer (UK) Cust_exp1
MAT-EXP
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Deemed Exports -Finished goods
2
Shipping
Shipping
Sales Order
1
4
Excise invoice
3
Bill of Sale
Billing
5
Period end processing
Deemed Export Customer CUST_DEXP1
VAT- MAT1 (VAT rate 10%)
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Intra State Finished goods (VAT exempt) Sales pricing
and Tax procedure
Sales Order Pricing
Basic Rate Rs83X 10 pcs= Rs 830
Excise Duty @20 = Rs 166
Tax Base Amount Rs 996
VAT Rs. 0
Total Rs.996
Pricing procedure JFACT
Condition type UTXJ
Access sequence JIND
Access Country/ Plant Region / Region/ TaxCl1Cust/ Tax Cl.Mat
Tax Code S2
Tax procedure ZEXVAT
ZIN 1
0%
VAT
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I N 1 0
M u m b a i
E x c i s e I n v o i c e
S t o c k i n
T r a n s i t
C r I n v e n t o r y A / c P l a n t 1 = R s 1 0 0
D r I n v e n t o r y A / c P l a n t 2 = R s 1 0 0
N o A c c o u n t i n g E n t r i e s a n d
N o I n v o i c e v e r i f i c a t i o n
N o V A T c r e d i t s
S T O f r o m
P l a n t 2
Q t y 1 E A
R a t e 1 0 0

G o o d s I s s u e
M v t 6 4 1
C r E D P a y a b l e A / c = R s 1 6
D r E D C l e a r i n g A / c = R s 1 6
I N 2 0
C h e n n a i
C a p t u r e & P o s t
E x c i s e I n v o i c e
G o o d s R e c e i p t
M v t 1 0 1
D r R G 2 3 A / C A / c = R s 1 6
C r E D C l e a r i n g A / c = R s 1 6
M A H A R A S H T R A
V A T R e g I D 1
T A M I L N A D U
V A T R e g I D 2
P e r i o d E n d
P r o c e s s i n g
P e r i o d E n d
P r o c e s s i n g
Inter-State Stock Transfer via SD
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Intra-State Stock Transfer











































M u m b a i
P l a n t 1
E x c i s e I n v o i c e
S t o c k i n
T r a n s i t
C r I n v e n t o r y A / c P l a n t 1 = R s 1 0 0
D r I n v e n t o r y A / c P l a n t 2 = R s 1 0 0
N o A c c o u n t i n g E n t r i e s a n d
N o I n v o i c e v e r i f i c a t i o n
N o V A T c r e d i t s
V A T R e g i s t e r
U p d a t i o n
( Q t y & V a l u e )
S T O f r o m
P l a n t 2
Q t y 1 E A
R a t e 1 0 0
V A T R e g i s t e r
U p d a t i o n
( Q t y & V a l u e )

G o o d s I s s u e
C r E D P a y a b l e A / c = R s 1 6
D r E D C l e a r i n g A / c = R s 1 6
M u m b a i
P l a n t 2
C a p t u r e & P o s t
E x c i s e I n v o i c e
G o o d s R e c e i p t
D r R G 2 3 A / C A / c = R s 1 6
C r E D C l e a r i n g A / c = R s 1 6
M A H A R A S H T R A
V A T R e g I D 1
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VAT Listing
Report RFUMSV00