Tax Exemption for a Contract Account

[Former Member]

Dear Experts,

A tax is raised during invoicing of electricity bill for all Contract Accounts. I have a requirement where I have to exempt tax for some Contract Accounts. The tax code has been defined in IMG in Financial Accounting.

When inputting the Tax Code in CAA2 in the Tax Exemption grid, I get the error message - 'Enter a valid tax procedure' .

Have I missed a Config?

Kindly advise

Malini

[Former Member]

Hi Malini,

Probably you have missed some settings for tax procedure or you have not assigned it in SPRO. Do so in the below mentioned path :

Financial Accounting -> Financial Accounting Global Settings ->Tax on Sales/Purchase ->Basic Settings

Regards,

Richa Tyagi

Edited by: Richa Tyagi on Mar 23, 2011 6:30 AM

[Former Member]

Dear Richa,

Find below the configuration done:

1) Financial Acctg >>Fin Acctg Global Settings >> Tax on Sales/Purchases >> Calculation >> Define Tax codes for sales/Purchases>> Define Tax code

2) Financial Acctg >>Fin Acctg Global Settings >> Tax on Sales/Purchases >>Basic Settings >> Check Calc Proc >>

(a)Define Cond type (b) Define Proc

3) Financial Acctg >>Fin Acctg Global Settings >> Tax on Sales/Purchases >>Basic Settings >> Check & Change settings for Tax Proc

4) Financial Acctg >>Fin Acctg Global Settings >> Tax on Sales/Purchases >> Postings >> Define Tax Acc

5) Financial Acctg >> Contract Acc Receivable & Payable >> Basic Functions >> Doc >> Maintan Doc Assignment >> Maitain Transanction for ISU/IST > Define Acc Assignment for Auto Posting >> Auto GL Acc Determination >> ISU Define Acc Assignement Data Relevant to Transaction

6) Financial Acctg >> Contract Acc Receivable & Payable >> Basic Functions >> Postg & Doc >> Doc >> Define Acc Assign >> Auto GL Determination >> Define Acc for Sales & Purchases Tax

7) Financial Acctg >> Contract Acc Receivable & Payable >> Basic Functions >> Postg & Doc >> Doc >> Maintain Doc Assign >> Define Sales/Purchases Tax Determination

Have I missed something?

[Former Member]

Dear All,

Can an 'Event' be used to use a zero-rated tax code for the Contract Accounts to be exempted from tax

Thanks for a reply

Malini

[Former Member]

Hi Malini,

Did you enter a value for :

Financial Acctg >>Fin Acctg Global Settings >> Tax on Sales/Purchases >>Basic Settings >> Assign country to calc procedure?

Regards,

Richa Tyagi

[Former Member]

Hi Malini,

This error occurs because of the following reasons:-

1) Either you are using more i tax calculation procedure or

2) You have not assigned the sales tax code to the proper calculation procedure which you need to use.

Try assigning the sales tax exemption code to the proper Tax calculation procedure.

Regards,

Richa Tyagi

[Former Member]

Thanks for the tips Richa,

All the configs have been done - cal procedure assigned to country code etc.

We have eventually used an Event to check a flag and then assign a '0%' tax code to billing line items

Rgds

Malini

[Former Member]

Hi Malini,

Could you tell me which event did you use?

Regards,

Richa Tyagi

[Former Member]

Event ISU_SAMPLE_R413 has been used

[Former Member]

If in a 'move' process, customer is not carrying the BP and CA, you can also use Installation Facts.