New VAT rates to be applied to Residential customers in invoicing

[Former Member]

Hi Experts,

We have a situation, where the client want us to switch to new VAT rates during invoicing as of 1st April for Residential customers . I have created new VAT rates but the issue is configuring at the EK02 level.

Current data model has the differntiation on Residential and Non-Residential at BP level only.

Also at the rate category and rate type level this categorization is not maintained. Anyone faced similar issue or got a clue how to tackle this and apply this new VAT for Invoices that are generated for Residential customers.

Also during the Rectification will the new VAT rates be shown along with the old ones in the invoice as we have a concept of adjustment billing here.

Any inputs are welcome. Thanks in advance.

Regards,

Priyanka

[AmlanBanerjee]

Hi Priyanka,

What about the Account determination ID(AD ID) that is assigned at the contract account\contract level.

Using AD ID, you can segregate the different types of customers at the master data level and as well at the transaction data level.This is best practice and is the most cleanest approach from a reporting prespective as well.

AD ID is a configurable field and you can use it to have a separate combination of Company Code\AD ID\Div\Main Tr in EK01 and Company Code\AD ID\Div\Main Tr\SubTr in EK02.

Now with your second query-Are you talking about adjustment reversals (EA21)?

If so, I think so the old VAT rates will be shown in the adjustment reversals.

Hope it helps...

Thanks,

Amlan

[Former Member]

HI Amlan,

Indeed I had thought so but the current data model doesnt support it.

As per the current data model at CA level there is no field that identifies the CA is residential or commerical.

The account determination currently maintained just differentiated if the tax needs to be applied for CA or not.

Introducing a new account determination would mean we would have to adapt the all the main-subs which are existing currently and incase of invoice adjustment or reversal I think we will face a problem.

Regards,

Priyanka

[AmlanBanerjee]

Hi Priyanka,

You have to have some field at the CA level,. which would distinguish the different types of customers.

Account determination at CA level would have been the best solution.

However, since you are using the AD ID for a different purpose, you have to find some other field to map the segregation.

What about the Invoicing category field (FKKVKP-INV_CATEGORY)?

It is a key that references the contract account reference in invoicing.

Together with the invoicing type and invoicing process, it controls the invoicing functions.

This field is a maintainable field ,which you can maintain through SM30 against table TFK2604.

Hope it helps...

Thanks,

Amlan

[Former Member]

Hi Amlan,

Thanks for you reply .

I think I will introduce a new account determination id for Non-residential customers as they are very few and do conversion for them and then adapt a new Tax Determination Code for them with previous tax code (that we dont want to change for non-res customer) and configure along with new main/sub.

For the residential customers I will not change the tax determination code or the account determination id as Res cutomer are huge in number (so less conversion to do ) and will add a new tax code that will start from the expected date. This should hopefully solve the issue at the FI/FICA part at least.

Now the issue is with the VAT determination at the line item level of the billing doc. Does anyone know how tax is determined at line item level of Billing doc as we have to apply these new rates to the consumption line items only.

Thanks,

Priyanka

[AmlanBanerjee]

Hi Priyanka,

Check with your billing person to have the list of sub-transactions (both debit and credit) that are assigned to the rate in the Billing schema against the Consumption Line items and not the Supply charges. Once you have the list, you have to map them against the invoicing main-transactions, normally 0100,0200,0250 &0300.

Once you have map the above you have to extend the list for each combination of Company Code\Div\AD ID\main Tr\Sub Tr.

After that make changes in the tax code for each of the entry in Transaction EK02.  

Hope it helps...

Thanks,

Amlan

[gagan_bulani2 · Accepted solution]

Hi Priyanka,

The categorization between residential and Industrial customers is mostly maintained at Billing Class level.  And as Rate Category is linked to Billing Class, I hope you can takcle this scnerio at Rate Category Level.

Hope it helps.....

Regards,

Gagan

[Former Member]

Hi Gagan,

Thanks for your reply well I had thought so as well but the issue is with the data model. This wont solve our purpose as the billing class and rate category makes no differentiation between residential and commercial. as there were same VAT rates applied before..now I am wondering what should be my next approach when there is no differentiation like this ?

Thanks,

Priyanka.

[Former Member]

The issue is resolved by adapting the new tax code in SPRO, FQC1 and EK02 and creating/adapting the account determination ID for Elec non-res customers to have less conversion.