Tax classification for sales order before ECC

[Former Member]

Hi expert,

We have recently upgraded from 4.6C to ECC6.0 and noticed the following
issue, please kindly advise. Thanks.

The tax classification for one of the regular customer has always been
maintained as ‘0’ (Tax Exempt).

In 4.6C, in the sales order condition tab, the system will auto
calculate and reflect the output tax amount automatically for this
regular customer.

However, in ECC6.0, with the same customer and material, the sales
order will no longer auto calculate and reflect the output tax amount
anymore.

Nevertheless, if we maintain the customer tax classification field
as ‘1’ (Liable for Taxes) before raising the sales order, or if we
amended the sales order tax classification field manually as ‘1’, then
the output tax amount will auto calculte and reflect as expected.

We would like to know why is there such differences between 4.6C and
ECC6.0. What should be the proper standard behaviour and if there is
any actions required be get the system to perform as per in 4.6C?

Please kindly advise. Thanks.

Best Regards,
Vincent

[Former Member]

Hi Vincent,

Please check the Condition tab in your sales order and click on "Analysis" button to see what exactly has hapenned.

[Former Member]

No issue with that too.

If Tax Class1-Cust = 0 and Tax class. material = 1, Set it as 0%., which is what ECC6.0 is doing correctly now.

But in 4.6C, all sales order under the header billing, the alternative tax classification always is 1 even though customer master is 0.

[Former Member]

Hi Vincent,

There you are - Was there any practice as part of your process during the 4.6C times, that you manually enter the alt. Customer Tax Calssification. Please check and confirm.

Regards

[Shiva_Ram]

To me, it looks like an user exit was used in 4.6C, however this does not get activated in ECC. Check with an ABAP'er who can help with this.

Regards,

[jignesh_mehta3]

Hello,

Ideally there should be no difference in tax classification determination in Sales Order in 4.6 & 6.0.

If the Tax Classification is 0 in Customer master the same will flow in Sales Order at Header level. The Item level Tax classification will come from Material Master.

I am sure there is some issue with Master data maintenance at your end which is causing this discrepancy.

Thanks,

Jignesh Mehta

[Former Member]

No history log in the customer master for this change.

[siva_vasireddy2]

Hi,

Plz check your Tax Condition records relevent to Tax Classification-0

also check the Tax code in

check whether the Tax Procedure is Taxinn or Taxinj

if it is Taxinj Tax code Plays a major role

if it is Taxinn your condition record plays a Major role.

[Former Member]

We don't use Taxinn or Taxinj

[former_member205178]

Hi,

I am sure you must have done some of the analysis already on these points but it does not harm to do it again: 

1) Check the Customer Master and check the Tax Category of the Customer to make sure that it is maintained as 0;

2) Check the Tax Record [MWST Tax Condition Type normally] for whichever tax table you are maintaining it for exists 

3) Check in the Condition Tab in Pricing Details if you are finding the assess to the Tax Records happening for the Customer and Material combination.

If you find any of these three as the smoking gun you should be good.

I do not think personally that if the issue is only with one customer that this is an upgrade issue. Even otherwise, Tax related stuff has not changed in anyway between those versions.

Get back to me if you have any questions.

Thanks.

[Former Member]

Thanks.

I have went thru the three points before and all are in order.

For the same customer, same material.

The customer master is always maintained as '0'.

The only difference is MWST can somehow auto calculated as 7% and reflect in 4.6, but in ECC, MWST is also populated but is now reflected as 0%.

Logically, ECC seems to be working correctly since customer has been maintained as tax exempted.

So now, just need to know why in 4.6, why it was not pulling the tax classification from the customer master and not working as per expected?

Please kindly advise. Thanks.

[former_member205178]

Hi,

Tell your Finance Guys to check the relevant Tax Code in FTXP which you can pick from the SD Tax Condition Record. The problem could lie there too.