taxes implications in sales and distribution........

[Former Member]

Detail Process:

The entire sales of my client is as follows

u2022 Domestic Sales.

u2022 Export Sales.

u2022 Stock Transfer Orders.

Further each type of sales is divided into two types, they are

Domestic Sales:

Trade Sales

non trade sales

Export Sales:

Sales to Nepal in Indian rupee.

Sales other than Nepal in Dollars.

Stock Transfer Orders:

Plant to Depot transfers.

Depot to Depot transfers (with in the state and out side the state).

so i need to capture the following taxes for my client:

I need to capture the below tax rates....I am not sure,how many Tax codes and Tax categories (TAXINN -SD) are required to capture the same....How should i go with this ?

1. CST Tax rates:

3%CST against Form C

4% CST on some materials

12.5% CST

15% CST in case of Gujarath

0% CST against Form H ,Excise is applicable

0% Excise against Form CT1- but CST applicable @ 2%,4%,12.5% CST

0% CST and Excise against Form CT1 and Form H

2. VAT rates:

0 % - Non -Taxable goods -Exempted

4% VAT on some materialsu202212.5% VAT

0% VAT against Form H (Excise is applicable)

0% Excise against Form CT1 but VAT applicable@ 4%,12.5% VAT

0% VAT and Excise against Form CT1 and Form H

so plz help me on this.

regards,

balaji.t

09990019711

[Lakshmipathi · Accepted solution]

Dear Balaji

Your FI people will have to create separate tax codes for each in FTXP. For example, in your case, for CST, you have listed 7 types. So 7 tax codes for CST alone has to be created and assigned in UTXJ. The same case for VAT also.

In UTXJ, you have to differentiate for Material Tax Classification and accordingly, while create sale order, depending upon the tax you want to levy, you should manually change the tax code so that your billing will be based on that.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

dear lakshmi pathi garu,

so i have to create how many condition types if i want to create all the taxes for

say for example i am taking cain chart of accounts,

export customer

domestic customer

etc.........

explain with an example sir.

regards,

balaji.t

Edited by: balaji timmampalli achari on Jun 13, 2008 12:11 PM

[Lakshmipathi · Accepted solution]

Dear balaji

In case of export, there is no problem at all. Since there wont be taxes, just one tax code is enough.

In case of domestic customers, as I said, first you have to idendity / list out the different percentage of tax which you are going to charge your customer. For CST, you have listed the following

- 3%CST against Form C

- 4% CST on some materials

- 12.5% CST

- 15% CST in case of Gujarath

- 0% CST against Form H ,Excise is applicable

- 0% Excise against Form CT1- but CST applicable @ 2%,4%,12.5% CST

- 0% CST and Excise against Form CT1 and Form H

So for all the above, you have to create tax codes in FTXP say

- AA for 3% CST

- AB for 4% CST

- AC for 12.5% CST

- AD for 15% CST

and so on which your FI people will do. Similarly for VAT also the same process will have to be followed.

All these tax codes will have to be assigned in VK11 / UTXJ, as follows:-

- 0 for 3% CST::::AA

- 1 for 4% CST::::AB

- 2 for 12.50%:::::AC

and so on.

As you have many combinations, while creating sale order at item level, Billing Document tab is there where you have to change the tax code depending upon as to how your client is going to collect CST.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

lakshmipathi garu,

so in customer master and material master u are saying to take like this know sir,

for eg: Customer Tax Classification Code:

Tax Class

1----

---

>Taxable

2----

---

>Form 14

3----

---

>Form 14B

4----

---

>Form C

5----

---

>Form 15

and material master:

Material Tax Classification Code

Tax Category

0-----> Mat tax class. 0

1-----> Mat tax class. 1

2-----> Mat tax class. 2

3-----> Mat tax class. 3

but still i have one doubt with me sir,

how many condition types like MWST/UTXJ shoould appear in customer/material master sir.

why bcz one condition type is allowing only 4 types to create ie 0,1,2,3.

for a single customer how many condition types should be there in customer/material master sir.

regards,

balaji.t

09990019711

[Lakshmipathi · Accepted solution]

Dear balaji

Please go through once again my comments

while create sale order, depending upon the tax you want to levy, you should manually change the tax code

You should not keep changing the masters. It will always be one value. What you have to do is that you have to change repeat you have to change manually in sale order.

thanks

G. Lakshmipathi

[pratik_mahendra]

You should be using TAXINN tax procedure and as rightly posted earlier FI will create tax code however, you will have to have 2 tax code for your requirement.

1. for CST not matter which slab u want to use.

2. is for VAT.

Remember, it is upto company's discretion to have more tax code but ideally you must have 2 tax codes. in case of kerala you may require different tax codes though.