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Tax Calculation on freight for India

Hi ,

When I am posting the customer invoice with freight charges the system is taking wrong tax base amount.Please find following scenarios for clear understand:

Scenario I:

At Item level my product cost is Rs1000 ,Tax code is 534(Dom.Sales-Goods(CST)) and I am giving frieght charges at Pricing Rs500.

System Calculation:

Total Item Net Value- Rs1000                              

Freight - Rs 500                                                                                                                              

Total Invoice Value - Rs1500                                                                                                            

CST 2% on Rs.1500 i.e      -  Rs 30                                                                                                

Total invoice value with Tax - Rs1530                                                                                                

Actual Calculation should be: 

Total Item Net Value- Rs1000

Freight - Rs 500

Total Invoice Value - Rs1500

CST 2% on Rs.1000 i.e      -  Rs   20

Total invoice value with Tax -  Rs1520

Scenario II:

At Item level my product cost is Rs1000 ,Tax code is 537(Dom.Sales of Goods(Excise and VAT)) and I am giving frieght charges at Pricing Rs500.

System Calculation:

Total Item Net Value- Rs1000                                    

Freight -                   Rs 500                                                                                                                                 

Total Invoice Value -   Rs1500                                                                                                             

BED 12.36% on Rs.1500 i.e-  Rs 185.40                                                                              

VAT  14.5% on Rs.1685.40 i.e Rs 244.38                                                  

Total invoice value with Tax-   Rs 1929.78                                                                                        

Actual Calculation should be: 

Total Item Net Value- Rs1000

Freight -                  Rs  500

Total Invoice Value - Rs1500

BED 12.36% on Rs.1000 i.e-  Rs  123.60

VAT  14.5% on Rs.1623.60 i.e Rs 235.42 (1000+500+123.60=1623.60)

Total invoice value with Tax-   Rs 1859.02

Scenario III:

At Item level my product cost is Rs1000 ,Tax code is 538(Dom.Sales of Goods(Excise and CST)) and I am giving frieght charges at Pricing Rs500.

System Calculation:

Total Item Net Value- Rs1000                                        

Freight -                  Rs  500                                                                                      

Total Invoice Value -   Rs1500                                                                 

BED 12.36% on Rs.1500 i.e-  Rs 185.40                                                           

CST  2 % on Rs.1685.40 i.e Rs 33.70                                                    

Total invoice value with Tax-   Rs 1719.11                                                 

Actual Calculation should be: 

Total Item Net Value- Rs1000

Freight -                  Rs  500

Total Invoice Value - Rs1500

BED 12.36% on Rs.1000 i.e-  Rs  123.60

CST 2% on Rs.1123.60 i.e Rs 22.47 (1000+123.60=1123.60)

Total invoice value with Tax-   Rs 1646.07

Kindly provide solution . Thanks in advance.

Regards,

Srikanth

Former Member
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