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CIN Requuirements

Former Member
0 Kudos

Hi Guys

basically what will be the basic business requirements in CIN.

thanks and regards

Accepted Solutions (0)

Answers (1)

Answers (1)

Former Member
0 Kudos

Hi Ashwath,

1 Chapter IDs

On this screen, you define the chapter IDs and corresponding descriptions as described in the excise tariff structure. This information is used when you create excise invoices and is also shown in the various excise registers.

2 Material and Chapter ID Combination

On this screen, you maintain the excise data relating to your materials. For each material, specify:

u2022 Chapter ID

u2022 Whether the material can be sent to subcontractors

u2022 The material type

This denotes, for example, whether the material is a raw material, a capital good u2013 this affects the CENVAT process u2013 or if it is a finished good on which excise has been paid, to be covered by the Update of RG 1 and Part I Registers.

u2022 Whether you accept more than one goods receipt per excise invoice, and if so, whether the excise duty should be credited to the CENVAT account immediately a goods receipt is posted (multiple credit) or not until all the goods receipts have arrived (single credit) (see Multiple Goods Receipts for a Single Excise Invoice)

This information is valid for a given plant. If the information is valid for all of your plants, however, leave the Plant field blank.

3 Material Assessable Value

On this screen, you maintain the net dealer price and the assessable value of all materials that you send to subcontractors or for any other issue. These values serve as the excise base value when the materials are issued, and tell the system how much excise duty to reverse from your CENVAT account.

4 CENVAT Determination

On this screen, you specify which raw materials are used to produce which finished (or semifinished) goods. The system uses this information to determine whether it you can claim a CENVAT credit for a material.

5 Excise Tax Rate

On this screen, you specify for each chapter ID every possible rate of excise duty that might apply, so you must take into consideration each permutation of plant and customer; and each combination of plant and vendor.

6 Additional Excise Rate

On this screen, maintain any cess applicable.

7 Exceptional Material Excise Rate

On this screen, maintain any exceptions that apply to the excise rates that you have defined. Exceptions can apply to a single material from all vendors, of to a single material from one vendor only. If you have an exceptional rate for a customeru2013material combination, you can maintain it here as well.

Excise Vendor Related Data

8 Vendor Excise Details

On this screen, you enter your vendors' tax numbers, which are used for various forms of correspondence and reports:

u2022 Excise registration number (and the range, division, and collectorate in which this is located)

u2022 Central sales tax (CST) number

u2022 Local sales tax (LST) registration number

u2022 Permanent account number (PAN)

In order for the system to be able to calculate which rate of excise duty to apply on purchases from the vendor, you must also:

u2022 Assign it a vendor excise duty status (for more information about how this works, see Determination of Excise Duty Rates)

u2022 Specify what type the vendor is, for example, a manufacturer, first-stage dealer, or importer for 57AE returns

u2022 If the vendor qualifies as a small-scale industry (SSI), you must also specify:

 What its SSI status is (which you must first have defined under SSI rates, see below)

 Whether or not it is participating in the CENVAT scheme

9 SSI Rates

On this screen, you define the excise rates that apply to purchases from vendors that qualify as SSIs. You define one status for each band (or "slab") of sales volume provided for by the law, and for each SSI status, the rates of excise duty that applies to that slab under the two schemes (see Excise Duty for Small-Scale Industries).

10 Excise Indicator for Plant and Vendor

On this screen, you define the final excise duty indicator (for more information about how this works, see Determination of Excise Duty Rates).

Excise Plant Related Data

11 Excise Indicator for Plant

On this screen, you enter your plants' tax registration numbers, which are used for various forms of correspondence and reports:

u2022 Central sales tax (CST) number

u2022 Local sales tax (LST) registration number

u2022 Permanent account number (PAN)

In order for the system to be able to calculate which rate of excise duty to apply on purchases for this plant, you must also assign it a plant excise duty status (for more information about how this works, see Determination of Excise Duty Rates).

12 Excise Indicator for Plant and Vendor

On this screen, you define the final excise duty indicator (for more information about how this works, see Determination of Excise Duty Rates).

Data Inputs Required for Capturing & Posting Excise Invoice

Material Document, Duty Values, Qty & Material details default from Material Document and Excise details will default from Excise Master Data.

While creating Subcontracting Challan

Material Issue Document, Document Year, Excise Group, Series group, Business Area, Posting Date, Material & quantity defaulted from Material Document

When processed Material sent by Vendor

While entering goods receipt refer to Subcontracting Challan.

For Reconcilliation of Challan : Enter Material Document & Year, Assign Qty & save document.

For Other outward movements Excise Invoice

Enter Referance Doc Type as MATD, Material Document No, Document Year, Series group, Excise group, Subtransaction Type, Customer,

Material, Qty gets defaulted from material Document, Chap-id, Ass. Value defaulted from Excise Master Data, Input Duty in % and save Documents.

1 Chapter IDs

On this screen, you define the chapter IDs and corresponding descriptions as described in the excise tariff structure. This information is used when you create excise invoices and is also shown in the various excise registers.

2 Material and Chapter ID Combination

On this screen, you maintain the excise data relating to your materials. For each material, specify:

u2022 Chapter ID

u2022 Whether the material can be sent to subcontractors

u2022 The material type

This denotes, for example, whether the material is a raw material, a capital good u2013 this affects the CENVAT process u2013 or if it is a finished good on which excise has been paid, to be covered by the Update of RG 1 and Part I Registers.

u2022 Whether you accept more than one goods receipt per excise invoice, and if so, whether the excise duty should be credited to the CENVAT account immediately a goods receipt is posted (multiple credit) or not until all the goods receipts have arrived (single credit) (see Multiple Goods Receipts for a Single Excise Invoice)

This information is valid for a given plant. If the information is valid for all of your plants, however, leave the Plant field blank.

3 Material Assessable Value

On this screen, you maintain the net dealer price and the assessable value of all materials that you send to subcontractors or for any other issue. These values serve as the excise base value when the materials are issued, and tell the system how much excise duty to reverse from your CENVAT account.

4 CENVAT Determination

On this screen, you specify which raw materials are used to produce which finished (or semifinished) goods. The system uses this information to determine whether it you can claim a CENVAT credit for a material.

5 Excise Tax Rate

On this screen, you specify for each chapter ID every possible rate of excise duty that might apply, so you must take into consideration each permutation of plant and customer; and each combination of plant and vendor.

6 Additional Excise Rate

On this screen, maintain any cess applicable.

7 Exceptional Material Excise Rate

On this screen, maintain any exceptions that apply to the excise rates that you have defined. Exceptions can apply to a single material from all vendors, of to a single material from one vendor only. If you have an exceptional rate for a customeru2013material combination, you can maintain it here as well.

Excise Vendor Related Data

8 Vendor Excise Details

On this screen, you enter your vendors' tax numbers, which are used for various forms of correspondence and reports:

u2022 Excise registration number (and the range, division, and collectorate in which this is located)

u2022 Central sales tax (CST) number

u2022 Local sales tax (LST) registration number

u2022 Permanent account number (PAN)

In order for the system to be able to calculate which rate of excise duty to apply on purchases from the vendor, you must also:

u2022 Assign it a vendor excise duty status (for more information about how this works, see Determination of Excise Duty Rates)

u2022 Specify what type the vendor is, for example, a manufacturer, first-stage dealer, or importer for 57AE returns

u2022 If the vendor qualifies as a small-scale industry (SSI), you must also specify:

 What its SSI status is (which you must first have defined under SSI rates, see below)

 Whether or not it is participating in the CENVAT scheme

9 SSI Rates

On this screen, you define the excise rates that apply to purchases from vendors that qualify as SSIs. You define one status for each band (or "slab") of sales volume provided for by the law, and for each SSI status, the rates of excise duty that applies to that slab under the two schemes (see Excise Duty for Small-Scale Industries).

10 Excise Indicator for Plant and Vendor

On this screen, you define the final excise duty indicator (for more information about how this works, see Determination of Excise Duty Rates).

Excise Plant Related Data

11 Excise Indicator for Plant

On this screen, you enter your plants' tax registration numbers, which are used for various forms of correspondence and reports:

u2022 Central sales tax (CST) number

u2022 Local sales tax (LST) registration number

u2022 Permanent account number (PAN)

In order for the system to be able to calculate which rate of excise duty to apply on purchases for this plant, you must also assign it a plant excise duty status (for more information about how this works, see Determination of Excise Duty Rates).

12 Excise Indicator for Plant and Vendor

On this screen, you define the final excise duty indicator (for more information about how this works, see Determination of Excise Duty Rates).

Data Inputs Required for Capturing & Posting Excise Invoice

Material Document, Duty Values, Qty & Material details default from Material Document and Excise details will default from Excise Master Data.

While creating Subcontracting Challan

Material Issue Document, Document Year, Excise Group, Series group, Business Area, Posting Date, Material & quantity defaulted from Material Document

When processed Material sent by Vendor

While entering goods receipt refer to Subcontracting Challan.

For Reconcilliation of Challan : Enter Material Document & Year, Assign Qty & save document.

For Other outward movements Excise Invoice

Enter Referance Doc Type as MATD, Material Document No, Document Year, Series group, Excise group, Subtransaction Type, Customer,

Material, Qty gets defaulted from material Document, Chap-id, Ass. Value defaulted from Excise Master Data, Input Duty in % and save Documents.

FAQ's

1. How does CIN determine the tax rates?

CIN determines taxes based on the chapter-id of the material. There are 2 levels for rate determination. First the system will check if there is an exceptional rate available. If this is available then that rate is picked up. This rate could be for a material or material and customer combination. If there are no exceptions then the system looks for chapter-id of that material. The customer will have an excise tax status which along with the plant status will give a final excise status. Based on the excise status and the chapter-id the rates are maintained.

2. Can I change the tax rates retrospectively?

You can change the excise rates with any given validity period. After making the changes you will have to update the sales orders if the new tax rates have to be considered for future deliveries.

3. Can I have a different rate for incoming and outgoing transactions for the same material?

You can maintain exceptional rates for either incoming or outgoing based on the volume of exceptions data.

4. What do I do if I have one chapter-id for incoming and another for outgoing and material code is the same?

Along with exceptional rate maintenance you can maintain the chapter-id which should be used for the outgoing transactions. This chapter-id will be used only for copying on to the document and will not be used for rate determination.

5. Can I have some more additional rates?

You can maintain multiple excise indicators and based on that you can have additional rates.

6. What will happen if I have multiple rates with overlapping validity periods for the same chapter-id and tax indicator?

While picking up the rate for a given transaction system will check for that validity period where the valid from is the maximum but with in the pricing date and based on that pick up the rate applicable.

7. How does CIN do the pricing?

CIN uses R3 condition technique for pricing along with the pricing formulae. Details are available in the CIN knowledge bank. Template pricing procedures are provided for various sales scenarios.

8. How many tax codes do I need?

The number of tax codes will directly depend on how you want to account the sales tax. You can have CST and LST being determined by the same tax code if both can be accrued into the same account. Instead if you need separate account determination then you need separate tax codes. Also based on the tax concessions available you need to decide the various tax rates which need to be mapped.

9. How do I open up more than one tax classification?

CIN comes with default customization to open up the tax classificvation fields. The procedure is as follows. You need to define as many condition types as the number of tax classification fields. Tbe following procedure could be used.

u2022 SPRO - Sales and distribution -Basic functions-Taxes - Tax

determination rules For Country 'IN' make entries as follows (This

is precustomized in client 000 )

- Seq 1 - UTXJ

- Seq 2 - JTX1

- Seq 3 - JTX2

- Seq 4 - JTX3

In SPRO - Sales and Distribution - Basic functions - Taxes

Determine tax relevancy of master records

10. How do I handle concessional excise?

This is explained in SAP note 335577. Having opened up the new tax classification

fields you might have to do the following

--> Customer taxes maintain the possible values for JTX3 . Each unique value should denote one concession rate. For eg 1 - normal excise duty

--> Maintain the JTX3 value against the form code in J1IT -Define Form types

Maintain the customer tax classification in customer master if the customer has got

excise exemption

--> Maintain the excise indicator in J1ID for the customer and form code and this indicator gives the final indicator

--> Forms database is used for determination of whether the form has arrived or not at the time of billing.

--> The tax classification value gets defaulted from the customer master in the sales order. This can be changed in the header

billing data if required

Reward if useful.

Thanks and Reagrds,

Naveen Dasari.