Material Tax Classification

[Former Member]

Dear All,

I have a material that is applicable to 2% CST and 4% VAT while selling. Tax classification 'C' was assigned to represent 2% CST and "F" was assigned to represent 4% VAT. IN OVK4, I have assigned these tax classifications. When I create the material master, I am able to assign either one of the tax classifications. I want to assign both of these two tax classifications in material master. Your answers are solicited.

Regards,

K Bharathi

[former_member183879 · Accepted solution]

Hi Bharathi,

If there are two taxes, you should use two different condition types. Say for example you use MWST for VAT and ZMWS for CST.

In OVK4, you will configure the tax category, its application tax classification and then save it.

In OVK3, maintain the tax country, tax category and the sequence.

Now if you create material master,

there will be two records like COUNTRY/MWST/______________ and COUNTRY/ZMWS/_________________

Note that for one tax category, there will be only one record. As there are two tax condition types, there are two records here.

Here in _____________ you maintain the default tax classification.

Now, when you create sales order, this default material classification will come. However you will be able to change to some other tax classifcn based on your allowed tax classifications maintained in OVK4

[Former Member]

Hi

CST will be purely on the basis of customer its not on the material.to whom your are selling its important.

I can guess you cannot bill the customer with both CST 2% & VAT 4 % at one time for the same material.

What i suggest is just have two tax classification for customer no.& maintain the same in customer master record. & maintain the condition record.

If the customer is applicable for 2% then it will have one tax classification & if it has 4% then the other tax classification.

If i am wrong just correct me gurus.

Hope you got the answer.

regards\

Rohit

[Lakshmipathi]

Ideally, tax classification will be based on ship to party only and not based on material. This being the case, I dont know why you need to have a different tax classification.

If at all any change in tax classification occasionally, you can very well change in sale order itself appropriately. Alternatively, you can also have multiple combinations of tax classification in UTXJ

thanks

G. Lakshmipathi

[Former Member]

Dear Lakshmipathi,

Thanks for your valuable reply. Here we use TAXINN; so we can't control by UTXJ.

Thanks to all replied.

Regards,

K Bharathi

[Former Member]

HI

You need to have two condition types assigned in OVK4 one is for CST and another for VAT.

Then for these condition types you can maintain the tax classifications.

Only if you have two condition types then only you will be able to assign the both in Material master

regards

Prashanth