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Value Added Tax (VAT)

Siemens Information Systems Ltd 1 of 27

CCoonnffiigguurraattiioonn DDooccuummeennttaattiioonn

FFoorr

VVaalluuee AAddddeedd TTaaxx ((VVAATT))

22000055



INDEX

Structure for Jurisdiction code (OBCO)………………………………………….03

Jurisdiction Code for TAXINJ (OBCP)……………………………………………04

Condition Types for Sales / Purchases (OBQ1)……………………………...…05

Condition Types for Sales / Purchases (OBQ1)……………………………...…06

Excise Tax condition Types (OBQ1)………………………………………...……07

Tax Processing in Accounting (OBCN)…………………………………………..08

TAXINJ procedure (OBQ3)………………………………………………………….09

TAXINJ procedure…………………………………………………………………....10

New Condition Types for SD – V/06……………………………………………....12

Pricing Procedure: ZJDEPO……………………………………………………..…13

Pricing Procedure: ZJFACT……………………………………………………..…14

SD Condition Types – V/06………………………………………………………....16

UTXJ Condition Type – V/06………………………………………………………..17

GL account for new Tax transaction keys (FS00)…………………..………….18

Customer Tax Classification - OVK3………………………………..……………20

Material Tax Classification – OVK4……………………………………………….21

Tax Codes (VAT) in UTXJ- SD ……………………………………………………..22

Tax Codes (VAT) in FTXP-MM…………………………….………..………………23

Business Places…………………………………………………………………...…24

Assign Business Places to Plants………………………………...………………25

Maintain Master Records……………………………………………………………26 Migration……………………………………………………………………………….27



Delete the Structure for Jurisdiction code (OBCO) Active Settings: The tax procedure TAXINJ from Jurisdiction code structure at field Proc. (V_TTXD-KALSM) is not present.

Remarks: This is in compliance with SAP recommendation.



Delete Jurisdiction Code for TAXINJ (OBCP) Active Settings: Jurisdiction Code for TAXINJ is deactivated.

Remarks: This is in compliance with SAP recommendation.



Define Condition Types for Sales / Purchases (OBQ1) Active Settings: For Inbound transactions three new Tax condition types to be introduced:

1. JIP4: A/P CST Non Deductible under VAT as a copy of JIP1. 2. JIP5: A/P VAT RM Deductible as a copy of JIP2 3. JIP6: A/P VAT RM Non Deductible as a copy of JIP3

For Outbound transactions new Tax condition type have introduced:

1. JIN6: A/R VAT Payable as a copy of JIN2 For all the above, Condition Category is maintained as “D” and the Access sequence "MWST" is assigned.

Remarks: The above condition types have been in place and in compliance per SAP recommendations.



Define Condition Types for Sales / Purchases (OBQ1) Active Settings: For Inbound transactions following conditions need to be maintained with Condition Category „D‟ and Access Sequence MWST:

1. JIP1: A/P C Sales Tax Inv. 2. JIP2: A/P L Sales Tax Inv 3. JIP3: A/P Sales Tax setoff

For Outbound transactions following conditions need to be maintained with Condition Category „D‟ and Access Sequence MWST: 1. JIN1: A/R Centr. Sales Tax 2. JIN2: A/R Local Sales Tax 3. JIN4: CST Surcharge 4. JIN5 : LST Surcharge

Remarks: For all the above, Condition Category is maintained as “D” and the Access sequence "MWST" is assigned which is in compliance with SAP recommendations.



Change in Excise Tax condition Types (OBQ1) Active Settings: For following conditions Tax Category „D‟ & Access sequence "MWST" has to be maintained:

1. JMO1 - A/P Excise duty for Setoff 2. JAO1 - A/P AED for Setoff 3. JSO1 - A/P SED for Setoff 4. JMO2 - A/P Excise duty for Inventory 5. JAO2 - A/P AED for Inventory 6. JSO2 - A/P SED for inventory 7. JMOD - A/R Excise Duty 8. JAED - A/R Add. Excise Duty 9. JSED - A/R Sp. Excise Duty 10. JCES - A/R CESS 11. JECS - IN A/R Education Cess 12. JEC1 - A/P Ecess for setoff 13. JEC2 - A/P Ecess for Inven

Remarks: For all the above, Condition Category is maintained as “D” and the Access sequence "MWST" is assigned which is in compliance with SAP recommendations.



Settings for Tax Processing in Accounting (OBCN) Active Settings: For following transaction keys for new tax conditions to be defined.

Akey Description Tax Types Non Deduct Posting Ind.

JP4 A/P CST Non Deductible

2 X 3

JP5 A/P VAT RM Deductible

2 2

JP6 A/P VAT RM Non Deductible

2 X 3

JN6 A/R VAT Payable 1 2

Remarks: The above transaction keys have been maintained as per SAP recommendation.



Change TAXINJ procedure (OBQ3) Active Settings:

In tax procedure TAXINJ, condition types JIP4, JIP5, JIP6 have been added immediately after JIP1, JIP2 and JIP3.

Transaction/ Account Keys and Alternative Calculation type have been assigned as follows

1. JIP4 - JP4 and 371 (ST inventory - India)

2. JIP5 - JP5 and 370 (ST setoff - India)

3. JIP6 - JP6 and 371 (ST inventory - India)

For the sales side, conditions JIN6 have been added in TAXINJ immediately after JIN1, JIN2, JIN4 and JIN5 conditions.

Transaction/ Account Keys and Alternative Calculation type have been assigned as follows:

1. JIN6 - JN6

Remarks:

Above is in compliance with SAP Recommendation.



The details of the TAXINJ procedure as maintained is given below:

Step Cntr CTyp Description From To Man Mdt Stat P SubTo Reqt AltCTy AltCBV ActKy Accrls

100 BASB Base Amount 962

110 Calculated call 100 652

120 Sub Total X

150 JMO1 A/P Eduty for Setoff 100 X 974 VS1

155 JAO1 A/P AED for Setoff 100 864 VS2

160 JSO1 A/P SED for Setoff 100 868 VS3

162 JEC1 A/P Eduty for Inven 150 864 VS1

165 ZMO1 A/P AED for Inventry 150 162 NVV

170 JMO2 A/P SED for inventry 100 862 NVV

175 JAO2 A/P AED E-cess Inv 100 865 NVV

180 JSO2 A/P SED for inventry 100 869 NVV

182 JEC2 A/P Ecess for Inven 170 207 865 NVV

213 Sub total for Sales Tax 120 182 363

214 LSTT TOT%LST-Fullsalestax 213 X 363 NVV

215 JIP1 A/P C Sales Tax Inv 213 371 363 NVV

216 LSTX A/P L Sales Tax Inv 213 371 363 NVV

217 JIP3 A/P Sales Tax setoff 213 221 370 363 VS5

218 LSTC SURCHARGE%-LST 216 217 NVV

219 LPTT TOT%LST(formBD/15EC 213 363 NVV

221 LPTX A/P Local Purch Tax% 213 972 363 NVV

222 ZPI3 A/PSTsetoff(BD/15EC) 213 363

223 LPTC Surcharge%-Pur.Tax 221 222 X NVV

230 ZPTX A/P Loc PurTax(Prov) 213 370 363 ZS5

231 ZUTX A/P Loc PurTax(Unrg) 213 370 363 ZS6

243 ZF31 Fm-31 ST Set off red 213 370 363 VS5

248 ZRST F31-Resale tax 213 370 363 NVV

260 JIP4 A/P CST Non deductib 213 371 363 JP4

270 JIP5 A/P VAT RM Deductibl 213 370 363 JP5

280 JIP6 A/P VAT RM Non-Deduc 213 371 363 NVV

440 ZRTU A/P RIGHT TO USE TAX 100 NVV

460 ZSER A/PService Tax Cenvt 100 ZS1

470 ZSC1 A/P Ecess on ser cvt 460 ZS2

480 JSER A/P SERVICE TAX 100 NVV

485 ZSC2 A/PEdu Cess on Serv 480 NVV

490 JSVD SERVICE TAX DEBIT 250 ESE

510 JMOD A/R Excise Duty 120 363

511 JAED A/R AED [Edu Cess] 510 X 366

512 JNED A/R N.C.C.D. 120 X 366

513 JSED A/R Sp. Excise Duty 120 X 360

514 JCES A/R Cess 120 X 352 367

515 Sub total X 352

517 JECS A/R Education Cess 515 X 352 366

518 Total of all central taxes 515 517 X 352

520 JIN1 A/R Centr. Sales Tax 518 X MW1

530 JIN2 A/R Local Sales Tax 518 MW2

532 JIN6 A/R VAT Payable 518 JN6

534 LST / VAT surch base 530 532 352

535 Subtotal 518 532



540 JIN4 CST surcharge 520 520 MW3

550 JIN5 LST surcharge 534 MW3

555 ZJAS LST surcharge- Addn 534 ZAS

560 ZTT1 A/R TO Tax(incl. ST) 518 MW4

570 ZTT2 A/R TO Tax(Inc ST) 535 MW4

580 ZST1 A/R SrvTx Payable 100

590 ZST2 A/R E cess serv tax 580



Active Settings: New SD condition types to be defined for VAT with Condition Category – „D‟.

JIN6: A/R VAT Payable Remarks: Above SD Condition Type are already in place in following Pricing Procedures: ZJDEPO ZJFACT ZJGDN1 ZJSCRP ZJFSPR ZJFSRT ZJFSP1 ZJBRAN YJFSPR YJGDN1 ZAHBAJ



ZJDEPO:

Proc. Step Cntr

Ctyp Description From To Man. Mdt Stat P SubTo Reqt AltCTy AltCBV ActKy Accrls

ZJDEPO 100 ZDSP Depot Selling Price X X 1 ERL

ZJDEPO 180 ZP01 Taxable Insurance 100 X 4 INS

ZJDEPO 190 ZTTR Territorial Rebate X ERL

ZJDEPO 250 ZDF1 Dep Taxable Freight X 5 602 FRT

ZJDEPO

255

YDF1 Dep Add.Taxable Frt 250 X 5 602

FRT

ZJDEPO 275 Tax Base 100 260

ZJDEPO 300 UTXJ Tax Jurisdict.Code 275 X 652

ZJDEPO 310 Sub Total 1 100 260

ZJDEPO 350 JMOD A/R Basic Excise 300 X D 355

ZJDEPO 400 JEX2 A/R Basic Excise 350 X X 2 353

ZJDEPO 550 JCES A/R Cess 100 190 X X H 359

ZJDEPO 720 JIN1 Central sales tax 275 X X X 3

ZJDEPO 740 JIN2 Local sales tax 275 X X X 3

ZJDEPO 740 JIN6 VAT Payable 275 X X X 3

ZJDEPO 760 JIN4 CST surcharge 720 720 X X X 3

ZJDEPO 770 JIN5 LST surcharge 740 740 X X X 3

ZJDEPO

772

ZJAS LST surcharge- Addn 740 740 X X X 3

ZJDEPO 775 Base Price+ST 310 772 X A

ZJDEPO 777 ZTT1 Turnover Tax 775 X X X

ZJDEPO 778 ZTT2 Turnover Tax 775 775 X X X 3

ZJDEPO 780 ZDF2 Dep Non-tax Freight 775 X X 3 602 FRT

ZJDEPO

785

YDF2 Dep Add Non-Tax Frt 780 X 3 602

FRT

ZJDEPO

790

Dealer Purchase Price 775 785 A

ZJDEPO 800 ZENT Entry tax X X 902

ZJDEPO 820 ZPDI Pre Delivery Inspect X PDI

ZJDEPO 860 ZVSC Veh service charges X VSC

ZJDEPO 870 ZVS2 Veh ser chg Year II X VS2

ZJDEPO

880

ZSRA Stock Reserve Akurdi X

SR1

ZJDEPO

882

ZSRC Stock Reserve Chakan X

SR2

ZJDEPO

885

ZSRW Stock Reserve Waluj X

SR3

ZJDEPO 890 ZDFP Dep Freight payable X

ZJDEPO 900 ZND1 Net Dealer Price

X



ZJFACT:

Proc. Step Cntr CTyp Description From To Man.

Mdt Stat P SubTo Reqt AltCTy AltCBV ActKy Accrls

ZJFACT 100 ZNDP Net Dealer Price X X 1 ERL ZJFACT 110 ZSPP Special Price X 1 ERL ZJFACT 150 ZFHA Forwarding/ Handling X X FLH ZJFACT 175 ZDR1 CSD Dealer Markup X 5 ERL ZJFACT 200 Ass Value 100 175 X ZJFACT

250

ZNCD Ass value (SED/NCCD) 200 X

ZJFACT 300 UTXJ Tax Jurisdict.Code 200 X X 652 ZJFACT 350 JMOD A/R Basic Excise X X X D 355 ZJFACT 375 Base Prices 200 ZJFACT 400 JEX2 A/R Basic Excise 350 2 353 EXD ZJFACT 410 ZEX2 A/R Basic Excise 400 X ZJFACT 475 Base prices + BED 375 400 X ZJFACT 550 JCES A/R Cess 200 X X X H 959 ZJFACT 575 JCED A/R Cess 550 X 353 EXC ZJFACT

590

Basic Price + BED + CESS 475 550

ZJFACT 600 JSED A/R Special Exc.duty 250 X X X H 959 ZJFACT 605 JNED A/R NCCD 250 X X X H 959 ZJFACT 610 JAED A/R Add. Excise duty 200 X X X H 959 ZJFACT 625 JEXS A/R SED 600 X 353 EXD ZJFACT 630 JEXN A/R NCCD 605 X 353 EXN ZJFACT 635 JEXA A/R AED 610 X 353 EXD ZJFACT 640 BED 400 X ZJFACT 641 CESS 575 X ZJFACT

643

Sub total of central taxes 625 642 X

ZJFACT 644 JECS A/R Education Cess 643 X X X H 959 ZJFACT 645 JECX A/R Education Cess 644 353 EDC ZJFACT 647 Basic price 375 X ZJFACT

648

Sub total of central taxes 643 X

ZJFACT 650 Sp. Disc. For CSD 645 648 X ZJFACT

653

Sub Total-Price+ED+Edu.cess 645 648 X

ZJFACT 655 ZCDM CSD Dealer Mark-up X 702 ERL ZJFACT 675 Ex-Factory Price 653 655 X 3 ZJFACT 700 ZP01 Taxable Insurance 675 X 602 INS ZJFACT 710 ZFR1 Taxable Freight X 602 FRT ZJFACT 715 YFR1 Add. Taxable Freight 710 X 959 FRT ZJFACT 720 JIN1 Central sales tax 675 715 X X X ZJFACT 740 JIN2 Local sales tax 675 715 X X X

740 1 JIN6 VAT Payable 675 715 X X X 760 JIN4 CST surcharge 740 X X X

775

Base Price+Excise+ST+Discount 675 770 X 6



777 ZFR2 Non Taxable Freight X 602 FRT

779

YFR2 Add. Non Taxable Fre 777 X

959 FRT 781 Copy of Ex factory 675 X 783 Taxes for Insurance 720 760 X

785

ZP02 Non Taxable Insuranc 781 784 X

602 INS

790

Dealer Purchase Price 775 785 X A

930 ZND1 Net Dealer Price X 940 ZVS2 Veh ser chg Year II X VS2 VS2 950 ZENT Entry tax X ENT ENT 960 ZPDI Pre Delivery Inspect X PDI PDI 970 ZFDI Factory Direct Incen X FDI FDI 980 ZDLR Dealer MarginInspect X 990 ZVSC Veh service charges X VSC VSC

Above are examples of Pricing Procedures. The complete list is available with BAL.



Maintain SD Condition Types – V/06

Activity:

All SD Cenvat Conditions like JMOD, JEX2, JECX, JAED, JEXA, JCED, JCES, JEXS, JECS, JECX should be maintained with Condition Category „D‟.

Remarks:

Condition Types JMOD, JAED with Condition Category „1‟ has been changed to Condition Category „D‟ and JECX, JEX2 with Condition Category „_‟ has been changed to Condition Category „D‟.



Maintain UTXJ Condition Type – V/06

Activity:

Condition Category „1‟ should be maintained with Access Sequence ZCIN.

Remarks:

Condition Category „1‟ is maintained with Access Sequence ZCIN. However ZCIN is having same tables 909 and 910 (copy of 11 and 368) with same fields. These tables should be marked exclusive. Currently these tables were not marked exclusively which was now maintained as exclusive.



Create GL account for new Tax transaction keys (FS00) Active Settings: Following new accounts are proposed to be opened after VAT is implemented. For input credits - in current asset group 461501 VAT Receivable - Raw Material & Components 461502 VAT Receivable - Capital Goods 461503 VAT Receivable - Opening Stock 461511 VAT credit on hold - Raw Material & Components 461512 VAT credit on hold - Capital Goods 461513 VAT credit on hold - Opening Stock Remarks: Above GL Accounts have been activated in PRD. For VAT reversals on non-productive use/shortages etc. - in expenses group 680211 VAT Others For reversal of input tax credit on depot/branch transfers. - in expenses group 660921 VAT reversal on depot transfers

For the Sales tax collected we propose to continue using the same account codes that are in use today. The list is as under. 221351 CST Current Year - Maharashtra 221352 CST Current Year - Uttar Pradesh 221353 CST Current Year - Bihar 221354 CST Current Year - West Bengal 221355 CST Current Year - Punjab 221356 CST Current Year - Haryana 221357 CST Current Year - Chandigarh 221358 CST Current Year - Rajasthan



221359 CST Current Year - Assam 221360 CST Current Year - Tamilnadu 221361 CST Current Year - Jammu and Kashmir 221362 CST Current Year - Orissa 221363 CST Current Year - New Delhi

221251 LST/VAT Current Year - Maharashtra 221252 LST/VAT Current Year - Uttar Pradesh 221253 LST/VAT Current Year - Bihar 221254 LST/VAT Current Year - West Bengal 221255 LST/VAT Current Year - Punjab 221256 LST/VAT Current Year - Haryana 221257 LST/VAT Current Year - Chandigarh 221258 LST/VAT Current Year - Rajasthan 221259 LST/VAT Current Year - Assam 221260 LST/VAT Current Year - Tamilnadu 221261 LST/VAT Current Year - Jammu and Kashmir 221262 LST/VAT Current Year - Orissa 221263 LST/VAT Current Year - New Delhi



Maintain Customer Tax Classification - OVK3 Active Settings: Following Key Indicators are currently defined for Customer Tax Classification:

Indicator Description

0 Export Customer Veh/Spares

3 Veh/Sp Part Dealer

6 Inter Div - IMS

7 Inter Div - OMS

8 Nepal / Bhutan 0%

9 Exempted Sale

A Veh/sp dlr w/o Form 'C'

G Matl/Scrap customer



Maintain Material Tax Classification – OVK4 Active Settings: Following Key Indicators are currently defined for Material Tax Classification:

Indicator Description

0 Chemical

1 Veh Taxable

I Pigment

J MH, 4% , Trading

K MH, 12.5% , Trading

L MH, 0% , Factory Part

M MH, 4% , Factory Part

N MH, 12.5% , Factory Part

B Agency Sale Business

Q Matl for proc srv tx



Create Tax Codes in UTXJ Activity: Following Tax Codes have been generated for VAT in FTXP and created condition records as below. Tax Codes have been assigned to respective GL accounts.

REGIOPL REGIO CUSTCL MATTCL RATE TAX CODE

GL A/C

MAH MAH 3 1 100% 1A 221251 0%

MAH MAH 3 1 100% 1B 221251 12.5%

MAH MAH 3 M 100% 1C 221251 4%

Above are examples of mapping Tax Codes. The complete list is available with BAL.



MM Tax Codes:

TX RATE

JM01 JM02 JEC1 JEC2 JIP5 3P 100% 2% 12.5%

3Q 0% 100% 12.5%

3R 100% 100% 2% 2% 12.5%

4A 100% 2% 4%

4B 100% 2% 4%

4C 4%

4D 100% 2% 12.5%

4E 100% 2% 12.5%

4F 12.5%

4G 100% 2%

4H 100% 2%

4I

4J 100% 2%

4K 100% 2%

4L

4M 100% 2%

4N 100% 2% 1%

4O 1%

4P 100% 2%

4Q 100% 2%

4R

4V

4W

4X 100% 2%

4Y 100% 2% 4%

4Z 100% 2% 12.5%

Above are examples of mapping of MM related Tax Codes.



Define Business Places – J_1BBRANCV Active Settings: Presently following Business Places are maintained: AK01 – Akurdi CH01 - Chakan / Akurdi WA01 - Waluj ZZ01 - Guwahati ZZ02 - Sambalpur ZZ03 - Kharagpur ZZ04 - Faridabad ZZ05 - Hosur ZZ06 - Jammu ZZ07 - Kota ZZ08 - Patna ZZ09 - Luknow ZZ10 - Chandigarh ZZ11 - Zirakpur ZZ12 - Delhi



Assign Business Places to Plants – J_1BT001WV Active Settings: Business Places were assigned to Plants: Remarks: Following Plants / Depots have been assigned to Business Places:

Business Place Plants / Depots

AK01 AK01

AK01 AK02

AK01 AK03

AK01 AK04

AK01 AK06

CH01 CH01

CH01 CH02

CH01 CH03

CH01 CH04

WA01 WA01

WA01 WA02

WA01 WA03

WA01 WA04

WA01 WA05

ZZ01 ZZ01

ZZ02 ZZ02

ZZ03 ZZ03

ZZ04 ZZ04

ZZ05 ZZ05

ZZ06 ZZ06

ZZ07 ZZ07

ZZ08 ZZ08

ZZ09 ZZ09

ZZ10 ZZ10

ZZ11 ZZ11

ZZ12 ZZ12

Maintain Master Records Master Data Maintenance



1. Customer Master Data:

Remove Jurisdiction Code: Maintain blank field in Jurisdiction Code field for all customers.

Define correct Region of Customer: Ensure correct input of Customer Region. Define correct Customer Tax Classification: Ensure correct input of Customer

Tax Classification. Define TIN Number: Maintain correct TIN Number for Customers.

2. Material Master Data:

Define correct Material Tax Classification: Ensure correct input of Material Tax Classification.

3. Condition Records for UTXJ:

Domestic: New condition records need to be created for the access sequence i.e. Region of Delivering Plant / Region of Ship to Party / Customer Tax Classification1 / Material Tax classification1 -Tax Code.



Migration Activity: BAL have foreclosed all Purchase and Sales Orders so that smooth migration can be availed.

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