Taxes in Consignment Sales

[Former Member]

hi SAP Gurus,

Can anyone help me in, how excise and taxes are levied in the 4 different stages of consignment sales.

Normally excise is applicable when the material is moved out of the plant, i.e. consignment fillup, but in this stage no billing is created.

Hence, when and how excise is calculated?

Points will be rewarded.

Thanks in advance,

Surya

[Lakshmipathi · Accepted solution]

Dear Surya

As you would be aware excise and tax are exempted for export sales / consignment process.

However, in order to capture excise duty in excise invoice, you need to maintain the respective condition type in your pricing procedure and have the condition type as statistical.

As you said, though in consignment fillup stage, no billing is created, you need to create proforma and with reference to this proforma, you need to create excise invoice via J1IIN so that the respective duty amount will be captured in SAP.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Hi Lakshmipathi,

Thanks for your reply.

But in case of domestic consignment sales, during Consignment Issue, we have to charge the customer, with excise and taxes, and it should have an accounting affect in SAP.

As per my knowledge excise and taxes are exempted only in export sales but not in domestic consignment process.

Can you clear this point.

Thanks in advance,

Surya

[Lakshmipathi · Accepted solution]

Dear Surya

Yes you are absolutely right. Taxes and duties are exempted only in case of exports and will be applicable in case of domestic scenario.

In domestic process, you have to first come to a conclusion as to whether

- you are treating the agent / warehouse as a third party or

- you are treating the agent / warehouse as your own depot

In case of first option, yes you have to levy duty and tax and in case of second one, only duty is applicable and tax is exempted.

thanks

G. Lakshmipathi

[former_member184555]

Hi

In consignment fillup - the excise will be charged but not the taxes. Since the material leaves the plant it attracts the excise. SInce the ownership still lies with us, it is not considered as sold and hence the taxes are not applicable.

Thanks,

Ravi

[Former Member]

Hello Surya,

In the consigmnment fill-up-- I don't think there is an implication on the accouting side or taxes or excise. In any of the above, the ownership of the goods is not changing hands..it is just that it is moved from unrestricted use to the consignment stock.

Similar is the case with pick-up.

With issue & returns, there are invoices created and goods change ownership etc..it might have tax implications. However, am also not aware of it.

Experts will help us understand it further.

Rgds,

Raghu.