SAP CIN - COUNTRY VERSION INDIA
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Transcript of SAP CIN - COUNTRY VERSION INDIA
Business Processes
Country Version India
AGENDA
• GLOSSARY
• BACKGROUND – CIN
• INTERFACE BETWEEN SAP AND CIN
• INDIAN LOCALISATION COVERAGE
• PROCESSES IN SAP WITH CIN
PROCUREMENT
SALES
FINANCE
REPORTS
GLOSSARY
CIN - COUNTRY VERSION INDIA
INPUT TAX -Tax that is charged by the vendor.
A claim for refund of the deductible portion of input tax can be submitted to the tax authorities
OUTPUT TAX -Tax levied on customers at all levels of production and trade.
Output tax represents a tax liability.
SERVICE TAX - Tax levied on the customer on services specified by the Government.
DEPOT - Depot is a plant where the material is stored and sold. There is no manufacturing activity at the depot. The depots when registered with the excise authorities can pass on the Modvat benefits to the customer.
GLOSSARY
EXCISE DUTY (BED) - A quantity-based tax which must be paid when a dutiable material is moved from a duty-free (bonded) location to a duty-paid (unbonded) location or the customer. Also known as excise tax. The excise duty is based on the quantity / Value of material moved.
AED – Additional Excise duty is a duty which is calculated over and above the Excise Duty payable on the material.
SED – Special Excise Duty is an additional duty levied on certain materials depending on the characteristics of the material. The statute specifies these materials.
CHAPTER ID –All materials that are required for manufacturing and subsequently those which are manufactured, are classified under the Central Excise Law into chapters. These chapters are further subdivided into headings and subheadings, which together form the chapter ID. Chapter ID 7216.10 is an example.
GLOSSARY
CVD – Countervailing duty is a levy charged on the imports of materials in lieu of excise duty.
CENVAT – Central Value Added Tax. The tax is levied on the difference between the output and the input value. This is also referred as MODVAT.
CESS – Cess is a tax imposed for a specific purpose under different acts with reference to certain goods. Cess is levied at the time of removal of goods from the factory.
OCTROI – A levy payable on the material to the local authorities.
ASSESSABLE VALUE - Denotes the value of goods that you have manufactured in-house at the price as assessed by an authorized auditor.
SETOFF – A certain percentage of input tax which is refunded by the government to the manufacturer. This refund does not form part of material cost.
GLOSSARY
INTERSTATE TRANSACTIONS - A transaction where the goods / material are traded between two different states.
CONCESSIONAL TAX FORMS – The Government announces tax concessions in excise and taxes on sales and purchase. This can be availed by submitting the forms prescribed by the Government. E.g ‘C’ form , AR4 , CT3.
TDS - Tax deducted at source ( Withholding tax) is a form of indirect taxation deducted at the beginning of the payment flow. Generally, an amount is withheld and paid over or reported to the tax authorities on behalf of (as opposed to by) the person subject to tax, the exception being self-withholding tax.
If a withholding tax exemption is available, withholding tax is not withheld.
GLOSSARY
REGISTERS – The registers are the books prescribed having specific format under the statute e.g RG23A,RG23D.
RETURNS – The prescribed forms having a specified format under the statute e.g. RT12, RG1, ANNUAL RETURN FOR TDS.
BACKGROUND
FIRST VERSION DEVELOPED IN 1996 IN RESPONSE TO NEEDS OF INDIAN CUSTOMERS
STANDARD PRODUCT SUPPLIED BY SAP AS AN ADD-ON
CONFORMS TO SAP DEVELOPMENT STANDARD (LOOK AND FEEL ETC)
SUPPORTED BY SAP DEVELOPMENT LAB AT BANGALORE
SAPFISD
MM
CIN FISD
MM
CIN INTERFACE WITH SAP
IN
FI - INTERFACE
COMPONENT
INSTALL COMPONENT
ACTIVATE COMPONENT
ACTIVATE PROCESSES
OPEN FI - INTERFACE
COUNTRY VERSION INDIA INSTALLATION
COPIES THE FOLLOWING
1. STANDARD INDIA TEMPLATES
2. TAX PROCEDURE (TAXINJ/ TAXINN)
3. CONDITIONS – EXCISE, TAXES ON SALES & PURCHASE, SERVICE TAX, CVD ETC
4. TABLES , FUNCTION MODULES , NO.RANGE OBJECTS, CUSTOMER EXITS
5. TAX DEPRECIATION KEYS
CIN INTERFACE WITH SAP
INDIAN LOCALISATION COVERAGE
COVERS THE FOLLOWING
CENTRAL / LOCAL SALES TAX
SALES TAX SETOFF
PURCHASE TAX
CONCESSIONAL TAX FORMS
SERVICE TAX
OCTROI
INDIAN LOCALISATION COVERAGE
BASIC / ADDITIONAL / SPECIAL EXCISE DUTY
MAINTENANCE OF RATES ON VENDOR CLASS
MAINTENANCE OF RATES AS PERCENTAGE & AMOUNT
UTILISATION OF MODVAT
FORTNIGHTLY PAYMENT
CVD ( IMPORTS)
SUB-CONTRACTING
SUB-CONTRACTING CHALLANS
RECONCILIATION OF QUANTITIES
MAINTENANCE OF 57F4 REGISTER
INDIAN LOCALISATION COVERAGE
MODVAT
UPDATING OF PART-I REGISTER FOR QUANTITY
UPDATING OF PART-II REGISTER FOR VALUE
UPDATING OF RG23D REGISTER FOR DEPOT
PRINTING OF EXCISE REGISTERS
PART-I / PART-II REGISTERS
RG1 REGISTER
RT12 RETURN
FACILITY FOR DOWNLOAD
INDIAN LOCALISATION COVERAGE EXTENDED WITHHOLDING TAX
WITHHOLDING TAX ON DOWN PAYMENTS / INVOICES / PROVISIONS
ACCUMULATIONS
MULTIPLE TAX LINE ITEMS IN ONE INVOICE
CALCULATION ALTERNATIVES (GROSS, NET, OFFSET)
ROUNDING OPTIONS
PAYMENT DUE DATES BY BUSINESS PLACE
CHALLAN UPDATE AND ACCOUNT CLEARING
SURCHARGE ON WITHHOLDING TAX
CERTIFICATE NUMBERING FOR DIFFERENT SECTIONS / BUSINESS PLACE
CERTIFICATE PRINTING WITH CUSTOMISABLE LAYOUT
ANNUAL RETURNS FOR VARIOUS SECTIONS OF INCOME TAX ACT
PROCUREMENT PROCESS
REQUIREMENTS AS PER INDIAN STATUTE
1. CALCULATION OF EXCISE DUTY BASED ON MATERIAL AND CHAPTER ID COMBINATION
2. CALCULATION OF EXCISE BASED ON CLASS OF VENDOR
3. CALCULATION OF INPUT TAX BASED ON INTERSTATE TRANSACTIONS
4. CALCULATION OF INPUT TAX SETOFF ON INCOMING MATERIAL (APPLICABLE TO FACTORY).
5. CAPTURE OF PART I AND PART II FOR CENVAT.
6. SUBCONTRACTING – U/S 57F4 WITHOUT PAYMENT OF EXCISE DUTY
7. SUBCONTRACTING – QUANTITY RECONCILIATION & SETTLEMENT
8. SUBCONTRACTING – PAYMENT OF EXCISE DUTY FOR NON-RECEIPT OF MATERIAL AFTER SPECIFIED PERIOD.
PROCUREMENT SCENARIOS
IMPORTMATERIALS
SUB - CONTRACTING
CAPITAL GOODS
LOCAL MATERIALS
TAX CALCULATION AT PURCHASE
1. TAXES ON SALES & PURCHASE ARE MAINTAINED AT FEDERAL LEVEL AND STATE LEVEL
2. THE EXCISE CONDITION IS MAINTAINED AT 100%
3. THE EXCISE RATE FOR THE MATERIAL IS MAINTAINED IN CIN MASTER.
4. THE INPUT / OUTPUT TAX RATE IS MAINTAINED FOR FEDERAL TAX AND STATE LEVEL TAX CONDITIONS
5. PERCENTAGE OF SETOFF ON INPUT TAX IS MAINTAINED IN SETOFF CONDITION
1. THE CHAPTER ID FROM CIN TABLE FOR THE MATERIAL
2. EXCISE RATE DERIVED FROM CHAPTER ID FROM CIN MASTER
3. IN TAX PROCEDURE 100% OF THE RATE IS CALCULATED
4. THE TAX CODE IS ENTERED IN THE LINE ITEM AND THE JURISDICTION OF THE VENDOR IS ACCETPTED AS AN INPUT.,
5. THE CVD IS ENTERED MANUALLY IN THE PRICING SCHEMA.
HOW TAXES ARE DETERMINED
SAP
PROCUREMENT- LOCAL PURCHASE
PRICING
Excise Rate Determination
Based on Material / Chapter ID and
Vendor Class
CREATE PO
CIN
GR
IV
Simulate & Post Cenvat.
Update Part I -QtyUpdate Part II –ValA/c. Determination
This also updates the excise header / line item tables.
SAP
PROCUREMENT- IMPORT PURCHASE
PRICING
Create Excise Invoice for CVD.
This is entered manually in PricingUpdate Part I - Qty
CREATE PO
CIN
GR
IV
Simulate & Post Cenvat.
Update Part II –ValA/c. Determination
This also updates the excise header / line item tables.
PROCUREMENT– SUB-CONTRACT
Create Sub- Contract Challan w.r.t mat. doc.Print Excise Challan
Update Register
SAP CIN
Settle w.r.t. sub-contract challan.
Consumes the child material.
Updates RegisterReconciliation and
Completion of Challan
TRF.POSTING
CREATE PO
GR
IV
This also updates the excise header / line item tables.
SAP
PROCUREMENT– CAPITAL GOODS
PRICING
Excise Rate Determination
Based on Material / Chapter ID and
Vendor Class
CREATE PO
CIN
GR
IV
Simulate & Post Cenvat.
Update Part I -QtyUpdate Part II –ValA/c. Determination50% - current year
50% - next year.
This also updates the excise header / line item tables.
SALES PROCESS
REQUIREMENTS AS PER INDIAN STATUTE
CALCULATION OF EXCISE DUTY BASED ON MATERIAL AND CHAPTER ID COMBINATION
1. CALCULATION OF EXCISE BASED ON CONCESSIONAL FORMS.
2. CALCULATION OF OUTPUT TAX BASED ON INTERSTATE TRANSACTIONS
3. MAINTENANCE & PRINTING OF EXCISE / ST. DETAILS OF CUSTOMERS ON INVOICES
4. USAGE OF PRE-PRINTED INVOICE NO.
5. LEVY OF SERVICE TAX ON ALL SERVICES RENDERED FROM FACTORY.
6. PAYMENT OF CESS ON CERTAIN CATEGORY OF MATERIALS (IF APPLICABLE
7. MAINTAINING OF EXCISE RULES
SALES SCENARIOS
FACTORYSALES
TAX CALCULATION - SALES
1. TAXES ON SALES & PURCHASE ARE MAINTAINED AT FEDERAL LEVEL AND STATE LEVEL
2. THE EXCISE CONDITION IS MAINTAINED AT 100%
3. THE EXCISE RATE FOR THE MATERIAL IS MAINTAINED IN CIN MASTER.
4. THE INPUT / OUTPUT TAX RATE IS MAINTAINED FOR FEDERAL TAX AND STATE LEVEL TAX CONDITIONS
5. REGIONS ARE MAINATINED AT PLANT / CUSTOMER
1. THE CHAPTER ID FROM CIN TABLE FOR THE MATERIAL
2. EXCISE RATE DERIVED FROM CHAPTER ID FROM CIN MASTER
3. IN TAX PROCEDURE 100% OF THE RATE IS CALCULATED
4. THE JURISDICTION IS DETERMINED BASEED REGION MAINTAINED IN CUSTOMER MASTER AND PLANT,
5. IF THE REGION IS SAME THEN STATE LEVEL TAXES ARE APPLICABLE ELSE FEDERAL TAXES WILL BE APPLICABLE . THIS IS DETERMINED BY THE ROUTINES IN TAX PROCEDURES.
6. THE TAXES ON SALES AND PURCHASES ARE DETERMINED BASED ON THE TAX CODES
TAXES ARE DETERMINED BY THE SYSTEM
SALES SCENARIOS – FACTORY SALES
SAP
Excise Rate Determination
Based on Material / Chapter Id / Form
type. ST based on
Jurisdiction and Tax Codes
CREATE SO
CIN
PGI
BILLING
Excise Inv. WRTSAP Billing Doc.Selection of RulesUpdate No. Range
Update TablesA/c Determination
This also updates the excise header / line item tables.
DELIVERY
REQUIREMENT OF FINANCEWITHHOLDING TAX
• ACCUMULATION OF TAX BASE AMOUNT• CERTIFICATE NUMBERING BASED ON BUSINESS
PLACE AND IT SECTION• ANNUAL RETURN FOR EACH SECTION• PAYMENT OF WITHHODING TAX• CALCULATION OF SURCHARGE• CERTFICATE PRINTING SHOWING TAX RATE INCLUSIVE
OF SURCHARGE• PAYMENT BY DUE DATE
EXCISE DUTY
• FORTNIGHTLY PAYMENT
PROCESS OF WITHHOLDING TAX
PAYMENT OF TDS
UPDATE CHALLAN
PRT CERTIFICATE
ANNUAL RETURN
TDS ON INVOICE
ADJ. FOR DOWN PAYMENT
CALCULATE TDS
THE TABLES FOR TDS AND CERTIFICATES ARE UPDATED
TDS ON PAYMENT
REQUEST FOR DOWN PAYMENT
PAYMENT OF REQUEST
CALCULATE TDS
ACCOUNTING
PROCESS FOR PAYMENT OF EXCISE
THE TABLES FOR EXCISE ARE UPDATED
SELECTION OF DATES
UTILIZATION
SELECTION OF REGISTERS
RG23A,RG23C,PLA
PAYMENT
ACCOUNTING
STATUTORY REGISTERS / REPORTSRG23A PART I REGISTER
RG23A PART II REGISTER
RG23C PART I REGISTER
RG23C PART II REGISTER
RG1 REPORT
RT12 REPORT
57F REGISTER
TDS CERTIFICATES REPORT
TDS ANNUAL RETURN REPORT
ALL THE REGISTERS & REPORTS WITH CUSTOMIZABLE LAYOUT WITH DOWNLOAD FACILITY ARE AVAILABLE AS PART OF STANDARD CIN
FISCAL YEAR
All the statutory reports and registers have to be maintained as per the Government Fiscal Year. The Government Fiscal year starts from 1st of April and ends on 31st of March of the subsequent year.
The Income Tax Depreciation has to be calculated on the basis of the Government Fiscal Year basis.
PSML Business Processes
Thank You