sap sd cin

India

Purpose

This country version is designed for use by businesses with operations in India. As well as the generic SAP

system functions, it comprises functions designed for laws and business practices particular to India, and acountry template to help you customize the system according to local requirements.

This documentation explains how the country-specific functions work and what Customizing settings are made by the country template. It does not cover the generic functions, which are described in the rest of the SAP Library.

Features

Country-Specific Functions

Most of the country-specific functions for India relate to Financials and Logistics. The main areas are as follows:

• Excise duty and the central value-added tax system (CENVAT)

• Withholding tax (also known as tax deducted at source)

• Sales tax

• Maintenance and printing of statutory excise registers

All of the menu paths given in this document are based on the India Localization role, with the exception of functions in withholding tax, whose menu paths are given from the SAP Easy Access menu.

Country Template

To allow you to customize your Indian company codes more quickly, you can use the Indian country template in

the Country Installation Program.

Financial Accounting (FI)

Purpose The Financial Accounting (FI) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component.

Features


Country Version India comes with a large number of additional functions for withholding taxes. The customer and vendor masters have been enhanced to store data only used in India. An extra report is also provided for depreciating assets according to the Income Tax Act.

Country Template

The country template for India comes with:

• Sample settings for calculating and posting taxes

• A chart of accounts and financial statement version

• Sample settings for asset depreciation

Taxes (FI-AP/AR)

Purpose The Taxes component covers the most important laws and business practices specific to India. The following

documentation describes these aspects of the component. For generic information about Taxes, see Taxes (FI-AP/AR).

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Features


Country Version India uses the standard functions for calculating and collecting withholding taxes. However, both Classic Withholding Tax and Extended Withholding Tax come with additional functions for tax remittance, journal vouchers, creating withholding tax certificates, and preparing annual returns.

If you want to handle excise duties, you must post the excisable transactions using the Materials Management (MM) and Sales and Distribution (SD) components. The system calculates the excise duty in these components and creates the appropriate line items in Financial Accounting (FI). However, if you only want to handle withholding taxes, you can use FI on its own.

Country Template The country template for India comes with settings for calculating and posting withholding taxes, and account determination settings for posting excise duty.

Excise Duty

Use The SAP system automatically calculates excise duties in Materials Management (MM) and in Sales and Distribution (SD), and posts them in Financial Accounting (FI).

The system covers all types of excise duty, all of which need to be calculated and reported separately:

• Basic excise duty (BED)

• Special excise duty (SED)

• Additional excise duty (AED)

• National calamity contingency duty (NCCD)

• Cess

• Education cess

• Countervailing duty

• Additional duty of customs

Features The system of excise duties is complex, and differs from the generic functions for taxes on sales and purchases in a number of ways:

• The rate of duty on a single material can vary according to which chapter ID it is listed under.

• You cannot offset all excise duty on inputs against outputs.

Depots cannot offset any input duties at all. Manufacturing plants can only offset input duties if they can show that the input materials are used to produce output materials.

• You have to record all excise duty (inputs and outputs) in excise registers.

• Your company may only be entitled to offset a portion of the duty on inputs against duty on outputs.

• Companies that qualify as small-scale industries can levy excise duty on outputs at reduced rates, so if you purchase materials from these companies, you must calculate a different rate of excise duty.

Excise Determination

MM comes with two ways of determining excise duties (and sales taxes) on input materials: formula-based excise determination and condition-based excise determination. The system calculates excise duties using a tax procedure.

SD also supports formula-based and condition-based excise determination, but in SD, the system calculates the taxes using a pricing procedure, not the tax procedure (see Pricing).

Reporting

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You have to remit the excise duty that you have collected to the central excise authorities. The law requires you to remit excise duty twice monthly: for the first half of any given month (1–15 inclusive) and from 16 to month-end. In each case, you are allowed five days to remit the excise duty. Country Version India offers a report to help you do just that (see Remittance of Excise Duty Fortnightly).

A small number of transactions have to be remitted on the same day (see Other Outward Movements).

In addition, the system allows you to prepare printouts of the various excise registers for the tax authorities.

Partial CENVAT Credit

Use

In some industries, businesses are only allowed to set off a portion of their input excise duty against output duty. In this case, the remainder of the duty is added to the material value.

Activities

Customizing

If any of your excise registrations are only entitled to claim partial CENVAT credit, set the indicator in Customizing

for Logistics – General, by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Excise Registrations.

Configure separate tax codes that split the excise and post some as tax and add the rest to the material price.

Day-to-Day Activities

The portion of the excise duty that is added to the material value is displayed in the excise invoice, along with the CENVAT credit. This amount is added to the inventory value when you post the goods receipt.

Remittance of Excise Duty Fortnightly

Use You use this report to calculate how much excise duty you must remit to the authorities. Legislation requires you to remit excise duty twice monthly: for all the goods issues in the first half of any given month (1–15 inclusive) and from 16 to month-end. In each case, you are allowed five days to remit the excise duty.

Once the report has determined how much you have to pay, it allows you to specify where the money should be paid from – whether it should be deducted from the CENVAT credits that you have accumulated, or whether it should be deducted from the personal ledger account (PLA).

Irrespective of which date you execute the report on, you can only utilize CENVAT credits posted up until the 15th or the last day of the month as the case may be.

Prerequisites You have:

• Customized the system so that when you create an excise invoice for a sale, the system automatically debits the excise to a CENVAT clearing account

• Made the settings in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

India → Business Transactions → Utilization

Features To access the report, on the SAP Easy Access screen, choose Indirect Taxes → Sales/Outbound Movements → Fortnightly Payment.

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Selection

On the selection screen, enter data as required:

• Organizational data (in the General data group box)

• Posting date for the CENVAT payment, if it is different from the run date

• The period to be covered by the report (for example, 1–15 January)

If, for any reason, you want to select an excise invoice individually, you can do so. Any entry in the Period field will be disregarded.

To display a list of all the excise invoices whose excise duty you have not yet remitted, choose Display pend. invoices.

To display a list of only the excise invoices for a given period, enter the period in the Period fields, select Select pending inv. for period, and choose Display pend. invoices. You can also print the list of pending invoices.

To display the last date when tax was remitted, choose Display last util. date (Display last utilization date).

Output

For each sort of excise duty, the system shows you:

• How much you have to remit (Amounts payable group box)

• How much credit you have at your disposal on the appropriate CENVAT account (Available balances)

This figure is equal to the credits on the CENVAT account less the minimum balance.

• How much credit you have on the CENVAT accounts (G/L account balances)

You now have to specify which accounts can be used to utilize the duty amount. In the Balance Utilization group box, the system proposes how much money should be taken from which accounts. You can overwrite these fields

if you want, and choose to refresh the display.

For a list of excise invoices that are considered for the CENVAT payment, choose Display excise invoices. You can print the list and use it as an annexure.

When you have finished, save your entries. The system then:

• Creates an accounting document that:

� Credits the CENVAT clearing account to remove the excise duty owed

� Debits the accounts from which the excise duty is to be paid

• Updates the Updates the Part II register

Value Added Tax (VAT)

Use

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In India, VAT has been levied in certain states from April 1, 2005. VAT is levied instead of the Local Sales Tax (LST). VAT also replaces other taxes such as, turnover tax, surcharge, additional surcharge.

Prerequisites You can configure the following tax procedures:

• For Condition-Based Excise Determination, configure the tax procedure TAXINN. For more information about TAXINN, see Configuration of Tax Calculation Procedure TAXINN.

• For Formula-Based Excise Determination, configure the tax procedure TAXINJ. For more information about TAXINJ, see Configuration of Tax Calculation Procedure TAXINJ.

Features The essence of VAT is that you can set off the input tax against the tax paid earlier. VAT is based on the value addition to the goods, and your VAT liability is calculated by deducting input tax credit from tax collected on sales during the payment period (say, a month).

You have purchased input worth INR 1,00,000 and your sales are worth INR 2,00,000 in a month, and input tax rate and output tax rate are 4% and 10% respectively, then input tax credit/set-off and calculation of VAT will be as follows:

● Input purchased within the month = INR 1,00,000

● Output sold in the month = INR 2,00,000

● Input tax paid = INR 4,000

● Output tax payable = INR 20,000

● VAT payable during the month after set-off/input tax credit = INR (20,000 – 4,000) = INR 16,000

The excise invoice that you capture contains one of the following:

● VAT Number – If your buyer belongs to a state where VAT is levied, VAT Number has to be printed on the excise invoice.

● Bill of Sale Number - If your buyer belongs to a state where VAT is not levied, Bill of Sales Number has to be printed on the excise invoice.

During billing, the system generates the VAT number if the VAT Registration number is maintained in customer master in the Tax Code 2 field. Else, the system generates a Bill of Sale number.

These numbers have to printed serially and separately for Bill of Sale, VAT invoice, credit and debit notes. You can do this using the Official Document Numbering.

Configuration for Official Document Numbering

Purpose Official Document Numbering is used to to print the numbers serially and separately for Bill of Sale (BOS), Value Added Tax (VAT) invoice, credit and debit notes.

Process Flow To configure the Official Document Numbering for India, execute the following activities in the IMG under Cross-

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Application Components → General Application Functions → Cross-Application Document Numbering → Taiwan.

Define Business Places for different plants.

Assign Business Place to Sales Office.

Maintain different document classes to generate different number ranges, for example, B for Bill of Sale, V for VAT Invoice.

Assign the document class for the VAT and BOS to the Document Type.

Maintain the Number Group.

Maintain the Number Ranges for the Number Group.

Assign the Number Range to a combination of Business place, Document Class and Number Group.

Service Tax

Use This is a tax that is levied on the services rendered. It is applied on the total price of the service.

Prerequisites In addition to the standard Implementation Guide (IMG) settings for taxes on service tax, you must also have maintained the tax registration numbers of your vendors, customers and your own plants.

If there are multiple tax registration numbers, you should have separate account postings to different General Ledger Accounts based on service registration number. You can do this provided you have maintained a separate tax code for each service registration number. To do this, for every service registration number, you should define separate General Ledger Accounts for service tax and education cess on service tax.

Features Service tax has the following features:

• It is charged at 12% on the price of the service rendered.

• An education cess of 2% is applicable on the service tax.

• This is a deferred tax. Only the amount of service tax that is actually received (credits) by the customer can be offset against the tax payable.

The interim General Ledger Account contains the total service tax that you have to receive. The final General Ledger Account contains only the actual amount that you have received. You can take credit for only the amount in the final General Ledger Account.

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• Service tax can be used to set off excise duty paid by you. Additional duty of customs cannot be used to set off the service tax paid by you.

• This tax is payable to the Central Government.

Example The price of the service is INR 10,000.

Service tax that is applicable is INR 1,200.

Education cess is INR 24.

Total amount to be received by you is INR 11,224. The system updates the interim General Ledger Account with this amount.

Now, assume that the customer makes a part payment, out of which INR 500 is against service tax. You have to manually update the final General Ledger Account with this amount.

You can offset only INR 500 against the payables in that month.

Sales Tax

Use This is a tax levied on the sale of a product. It is applied on the gross price of goods, inclusive of excise duty.

Prerequisites In addition to the standard Implementation Guide (IMG) settings for taxes on sales and purchases, you must also have maintained the tax registration numbers of your vendors, customers, and your own plants.

Furthermore, if the state legislation allows you to offset input local sales tax (LST) against output LST, you must also have defined this (see Material Master (Excise Data)).

Features There are two types of sales tax. Interstate sales (for example, between Karnataka and Tamil Nadu) are subject to central sales tax (CST). The tax rate is the same throughout the country. Intrastate sales, on the other hand, are subject to local sales tax (LST), which differ from state to state. The system handles these using tax jurisdiction codes.

A percentage of input LST can be deducted against output LST, depending on what percentage of goods you have purchased in the state in question.

The system calculates the sales taxes automatically, when you enter the tax codes. A report is also available that tells you how much sales tax you have paid and collected.

Sales Tax Register

Use You use this report to see how much tax has been accumulated under the various tax codes and tax jurisdiction codes for a combination of conditions.

You can also report how much input sales tax has been set off against the outputs. This report also can serve as the basis of determining your local sales volume and central sales volume.

Features To access the report, on the SAP Easy Access screen, choose Indirect Taxes → Registers → Sales Tax → Sales Tax Register.

Selection On the selection screen, fill out the following data:

• Organizational data

• General selections

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Specify which documents you want the report to cover. If you need more selection criteria, use the dynamic selection fields.

• General selection

Specify which taxes you want the report to cover. You can report either central sales tax or local sales tax by choosing a combination of ship-from and ship-to locations.

If you want to restrict the selection to specific locations, fill out the Ship-from and Ship-to fields.

Withholding Tax

Use Country Version India comes ready configured with all the settings you need to track and remit withholding taxes under the following sections of the Income Tax Act, 1961:

• Payments to contractors and subcontractors (Section 194 C)

• Insurance commission (Section 194 D)

• Rent (Section 194 I)

• Fees for professional or technical services (Section 194 J)

• Interest other than interest on securities (Section 194 A) (only supported in the Extended Withholding Tax solution)

Features Country Version India offers you two solutions for handling withholding tax (also known as tax deducted at source or TDS). You can either use the Classic Withholding Tax solution or the Extended Withholding Tax solution.

If you are installing the SAP system for the first time, we recommend that you use the Extended Withholding Tax solution. Before you decide one way or the other, however, you must give careful consideration as to whether Extended Withholding Tax covers your requirements. If you start working with this solution and it transpires that it does not cover your needs, SAP does not offer a strategy for migrating to Withholding Tax.

Taxes withheld under each section are treated differently with regard to the time limits for remitting tax to the authorities, providing the taxpayer with a withholding tax certificate, and filing an annual return. In addition, the formats for the withholding tax certificates and the returns also differ.

The Income Tax Act requires you to calculate taxes as soon as you enter an invoice. However, if you make a down payment to a vendor before you have received an invoice from it, you withhold tax on the down payment. Then, once the invoice arrives, you clear the down payment against it.

When you prepare your annual returns, the act also requires you to make provisions for taxes on services received but not yet invoiced.

Country Version India

Country Version India complements the generic Classic Withholding Tax and Extended Withholding Tax solutions with additional functions that meet the needs of the Income Tax Act. These functions allow you to:

• Ensure that you remit taxes within the due date

• Track and report withholding tax surcharges separately

• Adjust withholding taxes when you clear a down payment against an invoice

• Prepare withholding tax certificates and annual returns

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• Calculate withholding tax on provisions

Classic Withholding Tax

Use Under the terms of the Income Tax Act, you are required to calculate withholding tax (tax deducted at source, or TDS) when you post a vendor invoice. The system calculates withholding tax at the time of payment. To handle this difference in the calculation of the tax and to incorporate additional requirements, such as withholding tax certificate printing and annual returns, additional functions are provided.

Features The withholding tax for an invoice or a down payment is calculated at header level. That is, only one withholding tax code can be used for a down payment or invoice. This implies that an invoice cannot contain items with different withholding tax rates. It can, however, contain one or more items with the same withholding tax rate and one or more items with no withholding tax. This can be handled by specifying the base amount on which withholding tax is to be calculated. On account of calculation at header level, companies have to instruct their suppliers not to include items with different withholding tax rates in a single invoice, but issue separate invoices for different tax rates.

The system also allows you to print TDS certificates for vendors, and to reprint or cancel them if necessary. In addition, you can also prepare TDS returns.

Recipient Type

Definition

A system object that you use to classify payment recipients as legal persons or natural persons, for the purposes of withholding tax reporting.

Use

Customizing

Define the recipient types in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global

Settings → Withholding Tax → Withholding Tax → Basic Settings → Maintain Types of Recipient.

Create two entries as follows:

Master Data

When you enter the withholding tax types and codes in the vendor master, enter CO or OT in the Recipient Type

field, depending on whether the vendor is a legal person or a natural person.

Reporting

Recipient type Text

CO Companies

OT Others

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The annual returns separate the information about taxes withheld on legal persons and on natural persons.

Calculate Tax Deducted at Source

Use

You use this program to calculate withholding tax on vendor invoices.

It you have already posted a down payment for an invoice and withheld tax on it, the system automatically takes the tax already paid into account.

To access the program, from the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Payable → Withholding Tax → India → Withholding Tax → Tax Deduction at Source: Classic.

Prerequisites

You have already entered the invoices and the down payments.

Features

Selection

On the selection screen, enter the following data:

� Run Program in Test Mode

We recommend that you first run the program in test mode, then once you are satisfied with the results, in update mode.

� Process Invoices Only

Select this if you want to post TDS for a specific invoice. It speeds up the response time.

� TDS Date

This is the posting date that the system enters in the TDS document (update mode only).

Output

The system displays a list of invoices and specifies whether there are any down payments to be cleared against them.

Activities

In the output list, you can clear an invoice against a down payment as follows:

1. Position the cursor on the invoice that you want to clear the down payment against and choose . 2. Select the down payment that you want to clear. 3. Save the down payment.

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The system:

� Creates an accounting document to clear the down payment and reduce the vendor liability

� Recalculates the withholding tax base amount and the withholding tax amount, based on the amount of the down payment against which the invoice was cleared.

You can also clear invoices against down payments by first taking a list of all the invoices listed

above by choosing . You can then clear them by choosing Financial Accounting → Accounts

Payable → Document Entry → Down Payment → Clearing, and then clear each invoice one by one.

By clicking on the document numbers, you can display the document of the TDS posting.

You will have to make a manual FI posting to transfer the amounts from the respective withholding tax accounts (as defined in the withholding tax line items) to the TDS government payable vendor account. To make the payment to the TDS government payable vendor account, from the SAP Easy

Access screen, choose Accounting → Financial Accounting → Accounts Payable → Document

Entry → Outgoing Payment → Post.

Handling of Credit Memos

Use

This procedure shows you what happens if you post a credit memo against a vendor invoice. If you have already remitted the TDS from the invoice, the credit memo against that invoice is not considered at all for processing. Otherwise, the system calculates TDS for the amount stated on the credit memo and debits it from the TDS payable account.

Procedure

1. You post a credit memo, entering with the invoice number as the reference number. 2. You post the TDS in test mode.

The system displays a message, telling you to run the program in update mode.

3. You post the TDS in update mode.

The system makes the appropriate posting and displays the number of the credit memo along with the TDS posting document.

Making Down Payments on Invoices Where TDS Has Been Calculated

Use

If you have withheld TDS on an invoice but not yet remitted it to the government, and the invoice needs to be cleared against a down payment, you have to adjust the tax amount accordingly.

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Prerequisites

You have posted the invoice and the TDS document has been created.

Procedure

1. Clear the down payment against the invoice using the standard clearing transaction. 2. The next time you run the TDS posting program in update mode, the system makes a posting to correct the

TDS, by debiting the G/L account associated with the entered tax code. It also displays the numbers of the down payment clearing document and the TDS document.

Reversing TDS Postings

Use

If you reverse an invoice or down payment that you have already calculated TDS on, you also have to reverse the TDS postings.

Procedure

When you reverse a down payment in the standard, the system automatically reverses the TDS posting. When you reverse an invoice, the system reverses the TDS posting the next time you run the TDS report in update mode.

Remittance Challans

Use

When you have remitted the deducted TDS to the government, you are sent a bank challan confirming that payment has been received. The system allows you to record the number of the challan in the invoices from which the TDS had been deducted and paid.

You can also use this function to change the challan number or date later on, if necessary.

Features

To access this report, from the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Payable → Withholding Tax → India → Withholding Tax → Enter Remittance Challans.

Selection

The system displays the transactions on which you have withheld TDS. You select the transactions for which you have remitted the TDS, enter the challan details. The system then records the challan number in each of the transactions.

If you need to change a challan number or date, enter the challan number and date that is to be changed.

The actual TDS amount and the surcharge on this TDS amount are shown separately.

To handle cases where the company needs to have many TAN numbers, you can enter the TAN number when

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you update the challan number. This number will be used subsequently for the certificates.

Print Certificates

Use

You use this program to print TDS certificates for your vendors (individually or in batches). It covers the TDS in all the invoices and down payments that you have posted over a specified period.


Accounts Payable → Withholding Tax → India → Withholding Tax → Certificates → Print → Vendors.

There is a separate print program for one-time vendors, which you can access from the SAP Easy

Access screen, by choosing Accounting → Financial Accounting → Accounts Payable →

Withholding Tax → India → Withholding Tax → Certificates → Print → One-Time Vendors.

Prerequisites

You have already remitted the TDS to the government and recorded the challan number in the transactions concerned (see Update of Challans). Only transactions with a challan number can be included in certificates.

The certificate printing program uses SAPscript form J_1ITDSCERT. If there are some changes in the certificate format this layout set can be changed accordingly.

If the certificates are to be divided by business area, with a unique number range per business area, you must have maintained the sections as a combination of section and business area, so for business area 0001 and section 194C, you could maintain the section as 194C0001, for example.

Features

Selection

Enter data as required, including:

� The dates of the transactions that are to be covered in the certificate

� Withholding tax section

If you enter the business area in combination with the section, it must also be used in all other transactions involving this certificate, including annual returns.

Output

If you select the preview option, the system displays a certificate without any certificate number. The number will be assigned only when the certificate is actually printed directly (not from the print preview).

A summary of all the certificates is printed at the end, summarized by certificate and challan number.

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Reprint Certificates

Use

You use this program to reprint TDS certificates.


Accounts Payable → Withholding Tax → India → Withholding Tax → Certificates → Reprint.

Features

Selection

On the selection screen, enter the numbers of the certificates that you want to reprint and the details of the signatory.

Output

The system prints the certificates. Each certificate is marked as a duplicate.

Cancel Certificates

Use

You use this program to cancel TDS certificates.


Accounts Payable → Withholding Tax → India → Withholding Tax → Certificates → Cancel.

Features

Selection

Enter data as required, including the number of the certificate that you want to cancel.

Output

The system marks the certificate as canceled. It does not delete it from the database.

Archiving of TDS Documents

Use

You use these functions to archive documents for tax deducted at source (TDS). For more information about

archiving, see Introduction to Data Archiving.

Prerequisites

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Before you can archive this data, you must have archived the related data form Financial Accounting (FI) and Material Management (MM).

Features

The TDS documents are archived using archiving object J_1ITDS, which is supplied with Country Version India (CIN). It is used for archiving the data in tables J_1ITDS and J_1ICERTIF.

Once you have archived the TDS documents, you must delete the originals from the database. Once you have deleted the originals, you can reload them from the archive file. Finally, you can also analyze them.

Archiving TDS Documents

1. From the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts Payable →

Withholding Tax → India → Withholding Tax → Utilities → Archive Documents.

In the Object Name field, the system displays the name of the archiving object, J_1ITDS.

2. Choose Archive. 3. Enter data as follows:

� Variant

Enter the report variant that you want to use. You can create a variant if you need to.

� User Name

Enter the name of user who will archive the data.

4. To specify when to start the report, choose Start Date.

5. To enter the print parameters, choose Spool Params.

6. Choose .

Creating an Archive Report Variant

1. Choose Maintain. 2. Enter a variant name of your choice.

3. Choose Create. 4. Specify which certificates you want to archive and enter other data as required:

� Create

Specifies that the program will run in update mode.

� Delete in test mode

Select this for test runs.

� Package

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Enter the optimum package size.

� Comments

Enter any comments for your own reference.

5. Choose Attributes. 6. Enter data as required. 7. Save the variant. 8. Go back to the Archive Management: Create Archive Files screen.

Deleting TDS Documents




2. Choose Delete. 3. In the User Name field, enter the name of user who will delete the documents. 4. Select Test Run if you do not want to run the report in update mode.

This will report any inconsistencies between the table data and the archive file that can be fixed.

5. To specify what archive file you want to delete the documents for, choose Archive selection.



8. Choose .

Reloading TDS Documents




2. Choose Reload. 3. Enter data as follows:

� Variant

Enter the report variant that you want to use. You can create a variant if you need to.

� User Name

Enter the name of user who will reload the data.

4. To specify what archive file you want to reload the documents from, choose Archive Selection.



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7. Choose .

Archive Overview

Use

You use this report to find out where you have archived a tax deducted at source (TDS) document.

Features

Selection

On the selection screen, you specify which TDS documents you want to view. You can make your selection by vendor, business area, and TDS certificate number.

Activities

To access the report, from the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Withholding Tax → India → Withholding Tax → Utilities → View Archived Documents.

Transaction Codes for Classic Withholding Tax

Extended Withholding Tax

Use Country Version India contains a number of features that complement the generic Extended Withholding Tax

solution. For information about the generic functions, see Extended Withholding Tax. The country-specific features are described in the following documentation.

Features Using the Extended Withholding Tax solution, you can withhold and report tax under all sections of the Income Tax Act listed in Withholding Tax.

Since a company may consist of more than one entity responsible for withholding taxes, each of which is identified by a separate TAN, you use a separate SAP organizational unit to represent each entity, the section code.

Transaction Code Action

J1INC Post withholding tax on invoices

J1I8 Enter remittance challans

J1ICCERT Print withholding tax certificates for vendors

J1ICOTV Print withholding tax certificates for onetime vendors

J1ICREP Reprint withholding tax certificates

J1ICREP Cancel withholding tax certificates

J1INEFILE Prepare TDS returns

J1IHBK Copy bank IDs from invoice to TDS document

J2ID Archive TDS documents

J2IE Display archived TDS documents

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Activities

Customizing

For generic information about customizing Extended Withholding Tax, see Settings for Extended Withholding Tax: Overview.

Country Version India comes with sample Customizing settings for all of the aforementioned sections of the Income Tax Act. The settings include:

• Withholding tax types

• Withholding tax codes

• Official withholding tax keys, which represent the different sections of the Income Tax Act

• Recipient types, which represent the categorization of taxpayers into "companies" and "others," again, as per the Income Tax Act

You must also customize your own section codes.

Master Data Enter the required information in the vendor masters and in the customer masters.


You are required to calculate taxes either when you enter an invoice or when you make any sort of payment, whichever comes first. Since a full payment is seldom made before the invoice arrives, that means in effect that you withhold taxes when you enter an invoice or a down payment.

When you enter a vendor invoice or make a down payment that is liable to withholding tax, the system automatically creates line items for the appropriate taxes, including surcharges. Since different taxes need to be remitted on different dates, depending on the section of the Income Tax Act, the system also calculates and records each line item's due date.

If you first make a down payment (and withhold tax on it) and then enter the vendor invoice later on, you have to clear the invoice against the down payment so that you do not withhold tax on the same item twice.

As far as your receivables are concerned, you also enter withholding tax certificates sent to you by your customers, as proof of tax that they have withheld on payments to you.

Periodic Processing

At the end of each period, you make provisions for taxes on services received.

The authorities in India require you to remit taxes following a specific procedure. First, you create a remittance challan with a list of the withholding tax items that you are remitting. You then send the challan to the authorities, along with the check. Once the check has been cashed, the bank sends you a bank challan to confirm the payment. You then enter the bank challan in the system.

The system automatically tracks each withholding tax item's remittance challan and bank challan.

When you have remitted the tax, you can print out withholding tax certificates for all taxes that you have withheld, using functions specific to Country Version India.

Before you create your annual returns, you can also check for any customers that have not yet sent you a withholding tax certificate for tax that they have withheld from you.

Again, with receivables, if you make interest payments to your customers, you must also withhold tax on them as appropriate.

Reporting

Country Version India offers a report that you can use to prepare annual returns, and a Withholding Tax Information System for tracking and reporting purposes.

See also:

Accounts Payable (FI-AP)

Accounts Receivable (FI-AR)

Section Code

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Definition A system object that represents the organizational unit responsible for collecting and remitting withholding tax, as identified by a TAN.

Each company can have more than one TAN, so in the SAP system, a company code can also have multiple section codes.

Use

Customizing

Define section codes in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Basic Settings → India → Define Section Codes.


When you post a document with a withholding tax item (for example, a vendor invoice or a credit memo), enter the section code in order to make sure that the tax item is assigned to the correct TAN. For more information, see Entering Vendor Invoices.

In order to ensure that you always enter a section code, we recommend that you create a validation for this field.

Periodic Processing

When you print withholding tax certificates, each of your section codes can define its own forms, depending on which format is required by the income tax office. The certificate supplied with the standard system also shows the address data from the section code.

Reporting

Each TAN holder files its own tax returns. When you prepare a TDS return, you enter the TAN holder’s section code on the selection screen. The annual returns then show only the withholding tax items that are assigned to that section code.

Withholding Tax Type

Definition

See withholding tax type. For generic information about withholding tax types, see Defining Withholding Tax Types.

Use

Customizing

You define withholding tax types in Customizing for Financial Accounting (FI), by choosing Financial Accounting

Global Settings → Withholding Tax → Extended Withholding Tax → Calculation → Withholding Tax Type →

Define Withholding Tax Type for Invoice Posting and … → Define Withholding Tax Type for Payment Posting.

Country Version India comes with one set of sample withholding tax types for calculating tax at invoice posting and another one for calculating tax at payment posting. Both sets contain two separate tax types for each of the supported sections of the Income Tax Act (see Extended Withholding Tax), one for basic-rate tax and one for the surcharge.

All of the withholding tax types are customized so that certificate numbers are not assigned at this level. They are assigned by the programs that you use for printing the withholding tax certificates instead.

When you have defined the withholding tax types, define the withholding tax codes and recipient types.

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Master Data

Assign the appropriate withholding tax types to your vendor masters and customer masters.


When you enter a document that is liable to tax (for example, when you enter a vendor invoice), the system automatically applies the tax type and tax code appropriate to that vendor or customer.

See also:



Withholding Tax Code

Definition

For generic information about withholding tax codes, see Defining Withholding Tax Codes.

Use

Customizing

Define the withholding tax codes in Customizing for Financial Accounting (FI), by choosing Financial Accounting

Global Settings → Withholding Tax → Extended Withholding Tax → Calculation → Withholding Tax Codes → Define Withholding Tax Codes.

Country Version India comes with a sample tax code for each of the sample withholding tax types provided. The basic-rate withholding tax codes are set to 2%; the surcharge tax codes are set to 0.4%.

For reporting purposes, assign each withholding tax code to a withholding tax key.

Observe the special procedures when you customize withholding tax codes for Section 194 A of the Income Tax Act (see Exemptions and Reduced Rates for Section 194 A).

You must use withholding tax codes with posting indicator 1, otherwise you cannot clear down payments against invoices or remit withholding taxes.

Master Data Assign the appropriate withholding tax codes to your vendor masters and customer masters.


When you enter a document that is liable to tax (for example, when you enter a vendor invoice), the system automatically applies the tax type and tax code appropriate to that vendor or customer.

See also:



Withholding Tax Key

Definition A system object that you use to classify withholding tax items according to which section of the Income Tax Act they belong to. This information is required in TDS returns.

Use

Customizing

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Check the withholding tax keys provided in Customizing for Financial Accounting (FI), by choosing Financial

Accounting Global Settings → Withholding Tax → Extended Withholding Tax → Basic Settings → Define Withholding Tax Keys.

Assign an official withholding tax key to each withholding tax code.


Whenever you post a withholding tax item, assign it a withholding tax code as normal. Since each withholding tax code is also assigned to an withholding tax key, the system automatically knows which section of the Income Tax Act you have withheld the tax under.

Reporting

When you prepare a TDS return, it shows which section of the Income Tax Act you withheld each item under.

Recipient Type

Definition A system object that you use to classify payment recipients as legal persons or natural persons, for the purposes of withholding tax reporting.

Use

Customizing

Define the recipient types in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Basic Settings → Check Recipient Types.

For each withholding tax type, create two entries as follows:

Country Version India comes with sample settings for the sample withholding tax types provided.

Master Data

Enter the recipient type in each vendor master and each customer master.

Reporting The TDS returns separate the information about taxes withheld on legal persons and on natural persons.

Exemptions and Reduced Rates for Section 194 A

Use Under Section 194 A of the Income Tax Act, you withhold tax on interest payments that you make, with the exception of interest on securities. You declare such taxes withheld using form 26A.

However, some payments are exempt from withholding tax, and on others, you only have to withhold tax at a reduced rate – for example, if the recipient of the payment is a bank or is a company in possession of an exemption certificate.

When you prepare your annual return, you have to declare how much interest you have paid to companies without withholding tax or with reduced-rate tax.

Activities

Customizing

Define separate withholding tax codes for calculating withholding taxes at the reduced rates and for exemptions.

Make the additional settings for the withholding tax codes in Customizing for Financial Accounting (FI), by

choosing Financial Accounting Global Settings → Withholding Tax → Extended Withholding Tax → Calculation → Exemptions and Reductions.

Recipient Type Text

CO Companies

OT Others

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Master Data

Enter the appropriate withholding tax codes in your customer masters and vendor masters as normal. Do not enter any exemption reasons.


Whenever you post a withholding tax item that falls under this section of the Income Tax Act, make sure that you use the appropriate tax code.

Reporting

When you create a TDS return, it shows how many rupees’ worth of business you have taxed at a reduced rate, and how much was exempt from tax.

Exemptions and Reduced Rates Under Sections 197 and 197 A

Use Under sections 197 and 197 A of the Income Tax Act, the Income Tax Department can grant companies exemptions from having tax withheld from payments to them, or reduce the withholding tax rates.

You need to record this information in the system and report it in TDS returns.

Activities

Customizing

Define separate withholding tax codes for calculating withholding taxes at the reduced rates and for exemptions.

Make the additional settings for the withholding tax codes in Customizing for Financial Accounting (FI), by

choosing Financial Accounting Global Settings → Withholding Tax → Extended Withholding Tax → Basic Settings

→ India → Exemptions and Reductions.

Master Data

Enter the appropriate withholding tax codes in your vendor masters as normal. Do not enter any exemption reasons.

Reporting

When you prepare a TDS return, it shows how many rupees’ worth of business you have taxed at a reduced rate, and how much was exempt from tax.

See also:

Withholding Tax Code

Vendor Master (Withholding Tax Data)

TDS Returns

Surcharges

Use As well as withholding tax on payments to vendors, in India, you may also be required to withhold a surcharge.

Features Some tax offices require you to track surcharges separately from the basic withholding tax, that is, to create separate line items for the surcharges. Others prefer you to combine the two in a single line item. The system supports both calculation methods.

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Activities

Customizing

Set up the surcharge function in Customizing for Financial Accounting (FI), by choosing Financial Accounting

Global Settings → Withholding Tax → Extended Withholding Tax → Basic Settings → India → Surcharges.

Create withholding tax types and withholding tax codes for the surcharges. The standard system comes with samples for both.


When you enter a vendor invoice, the system automatically calculates any surcharges that apply. It either creates one withholding tax item or two, depending on how you have customized the system.

The following examples assume that the surcharge is 2% of the basic-rate withholding tax:

Vendor Invoice with Surcharges Shown Separately

Vendor Invoice with Surcharges Combined with Other Withholding Tax Items

Reporting

No matter which of the calculation methods you use, TDS returns show the surcharges separately.

Tax Due Dates

Use When you enter a vendor invoice, the SAP system automatically determines what date you have to remit the withholding tax to the tax office and records it in the tax line item.

Features There are several factors that influence the tax due date, all of which you can customize:

• Which section of the Income Tax Act the tax is from (represented in the SAP system by the official withholding tax key)

• Whether the vendor is classified as a company or not (in the system, the recipient type)

• In the event of the tax being due on a public holiday, whether the tax office requires you to remit the tax a day earlier or a day later

Activities

Customizing Set up the due dates in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Basic Settings → India → Maintain Tax Due Dates.

In Customizing for FI, under Financial Accounting Global Settings → Withholding Tax → Extended Withholding

Tax → Basic Settings → India → Assign Factory Calendars to Section Codes, specify whether, in the event of the due date falling on a public holiday, you must remit the tax on the day before or the day after.


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When you enter a vendor invoice, the system automatically determines the tax due date and enters it in the tax line item.

Periodic Processing

When you come to create a remittance challan to remit the withholding tax, the system uses the tax due date.

Withholding Tax on Interest Payments to Customers

Use Under Section 194 A of the Income Tax Act you are required to withhold tax on interest payments that you make to customers.

To calculate the interest, use the Balance Interest Calculation program, which calculates the interest and the amount of tax to be withheld.

Activities

Customizing

You have made the settings for interest calculation in Customizing for Financial Accounting (FI), by choosing

Accounts Receivable and Accounts Payable → Business Transactions → Interest Calculation.

Periodic Processing Execute the program as described in the documentation.

There are two types of output. The system either creates a batch input session, which you can process, or it displays the details of the interest to be posted, which you can post manually. In both cases, you must ensure that each customer line item contains a section code.

The program creates an accounting document as follows:

It copies the section code from the customer line item to the withholding tax item, and calculates the tax due date (see Tax Due Dates).

Journal Vouchers

Use

If, after you have entered and cleared a vendor invoice and you have discovered that you have posted the wrong amount of tax or that you have posted the tax using the wrong official tax key, you have to enter a journal voucher (JV) to correct the error.

To access the function, from the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Payable → Withholding Tax → India → Extended Withholding Tax → Journal Vouchers → Enter.

Prerequisites

You have maintained the settings in Customizing for Financial Accounting (FI), by choosing Financial Accounting

Global Settings → Withholding Tax → Extended Withholding Tax → Postings → India → Journal Vouchers.

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Features

You only need to create JVs to adjust withholding tax items and vendor items that you have already cleared. Otherwise, you can reverse the original document using the generic functions.

You do not need to adjust a tax item if you have already issued a withholding tax certificate for it and the vendor has accepted it, since, in this case, the vendor can use this certificate to claim a refund from the tax authorities.

When you enter a journal voucher, the system creates an accounting document as follows:

If you have already remitted the tax to the tax office and you change the tax code so that it uses a different official withholding tax key, the system makes a second posting to correct the tax under the right tax key. This posting debits the loss account and credits the tax expense account.

See also:

Entering Journal Vouchers

Entering Journal Vouchers

1. In the Document Number field, enter the invoice number.

2. Enter other data as required and choose Check. 3. Depending on what you want to change, choose Amount Correction or Tax Code Correction. 4. Change the tax amount to the correct amount, or change the tax code.

To check what adjustment posting will be made, select the line item that you have changed and choose

Simulate.

5. Save the journal voucher.

Provisions for Taxes on Services Received

Purpose

In India, when you come to prepare your financial statements, you are required to make an adjustment entry for any accrued withholding taxes.

That means that if, when you prepare your statements, a vendor has provided you with some services but not yet sent you an invoice, you make an adjustment entry for the taxes that you will withhold on the vendor payment. When you make the entry, you must take into account any tax that you have already withheld on any down payments that you have made.

Type of change Debit Credit

Tax refund to vendor (tax already remitted) Loss account Vendor account

Tax refund to vendor (tax not yet remitted) Tax payable account Vendor account

Tax increase, payable by vendor Vendor account Tax payable

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Once the vendor sends the invoice, you reverse the provision.

Prerequisites

In Customizing for Financial Accounting (FI), you have made the settings under Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Postings → India → Provisions for Taxes on Services Received.

Process Flow

1. A clerk enters a purchase order for services to be provided.

2. A vendor provides you with some services on 25 January, and the clerk enters the service receipt in the system accordingly.

The system then automatically creates the following accounting document:

3. At month-end, the vendor has not sent you an invoice. You will be required to withhold tax on the payment, so you enter a provision for the withholding tax.

The system creates an accounting document as follows:

You can now prepare your financial statements correctly.

4. On 7 February, the vendor sends you the invoice, and you enter it in the system.

When you enter the invoice, the system automatically calculates how much tax you have to withhold when you pay the vendor. It does not clear the provision against the invoice, so at this moment your accounts are actually incorrect, because they have two entries for the same amount of withholding tax.

5. In the evening, you reverse the provision.

The system creates the following accounting document:

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By reversing the provision, you put your accounts in order again.

Entering Provisions

On the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Withholding Tax → India → Extended Withholding Tax → Provisions for Tax on

Services Received → Enter.

Enter the following information:

� Organizational data, such as company code and financial year

� The G/L accounts that you want to post provisions for

� Other information relating to the items that you want to adjust (for example, vendors or purchase orders)

� Information relating to the posting document that the system will make the tax postings with

Choose .

A list appears, which shows you per purchase the following:

You now have to specify how much tax has to be withheld. For each purchase order:

Enter the tax type and tax code of the tax that has to be applied

Use invoice tax types only.

Enter the section code.

Column Information

Open amount The total amount of all services received that have yet to be invoiced, irrespective of whether you have already calculated tax on them

Open provision The amount from goods receipts that you have already calculated tax on

LC bas.amt (Base amount in local currency)

The amount on which tax still has to be calculated

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Enter the business area, if required.

If you have made a down payment on the purchase order, reduce the tax base amount by this amount.

5. When you have entered all the data, save it.

Reversing Provisions

Use

Follow this procedure to reverse provisions that you have made for taxes on services rendered. You can only reverse the provisions for invoices that you have received since you posted the provision.

We recommend that you run this program every night in the background, in order to avoid discrepancies in your data.

Procedure


Withholding Tax → India → Extended Withholding Tax → Provisions for Tax on Services Received → Reverse.

2. On the selection screen, enter:

� Organizational data, such as the company code

� The posting date of the invoices

� The posting period

3. Choose .

Remittance of Withholding Tax

Purpose You are required to follow a specific procedure when remitting withholding tax to the authorities.

Prerequisites Before you remit your withholding tax, you must have entered any provisions for taxes on services received.

Process Flow

When the time comes to remit a given sort of tax (see Tax Due Dates), you create a remittance challan.

The system creates an accounting document to transfer the withholding tax items to the appropriate bank account.

You send the challan to your bank with a check for the appropriate amount.

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After a few days, the bank sends you a bank challan to confirm that it has received your check.

You enter the bank challan in the system.

When you do so, the program records the bank challan number in every withholding tax item remitted. This information may be required in order to substantiate your accounts.

Result You can create withholding tax certificates for the withholding tax items that you have remitted.

Remittance Challans

Use The system allows you to create and cancel remittance challans for payables and receivables.

Prerequisites You have made the Customizing settings in Customizing for Financial Accounting (FI), by choosing Financial

Accounting Global Settings → Withholding Tax → Extended Withholding Tax → Postings → India → Remittance Challans.

Features

Accounting Documents

When you create a remittance challan, the system identifies which withholding tax items need to be remitted (see Tax Due Date).

It then creates an accounting document to clear these items from the withholding tax payable account to the bank account that you want to transfer the tax from.

Challan Numbers The system generates separate remittance challans for each tax office (section code) and each section of the Income Tax Act (withholding tax key) and numbers each one accordingly. It records the challan number in the withholding tax items for future reference, although you cannot display it directly from any of the system transactions.

Constraints The programs do not cover part payments of tax items or residual payments.

Creating Remittance Challans

To access the programs, on the SAP Easy Access screen, choose Accounting → Financial

Accounting → Accounts Payable → Withholding Tax → India → Extended Withholding Tax

→ Remittance of Withholding Tax → Create Remittance Challan or Accounting → Financial

Accounting → Accounts Receivable → Withholding Tax → India → Withholding Tax for

Payments to Customers → Remittance of Withholding Tax → Create Remittance Challans.


� Organizational data, such as company code and section code (TAN)

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� Which withholding tax items you want to remit

We recommend that in order to get the most accurate selection, you enter a payment due date.

If you need to restrict the selection to a specific vendor or customer, for example, if you want to remit the tax for government bodies only, you can do so.

� Tax remittance information, including any charges made by your bank for accepting the check

Choose .

The system calls the standard outgoing payment program, which presents you with a selection of tax line items for clearing.

To make it easier for you to select the open items, we recommend that you create a line layout that includes the following fields:

• Value Date (tax due date)

• Section Code

• Reference Key 3 (tax code and recipient type information)

• Text (information on down payment clearing tax transfer)

Activate the items that you want to remit and make a note of the total in the Assigned field.

Choose .

The system displays an overview of the line items created so far, including any bank charges that you have entered, and an offsetting posting to deduct your bank account.

Double-click the credit entry for your bank account.

Change the amount so that it matches the total line items (from step 3) plus the bank charges.

Choose Document → Simulate.

The system goes back to the line item overview.

To update the overview, choose Document → Simulate.

Save the document.

The program displays a list with the details of the challan numbers generated and the tax remitted. Basic withholding tax and surcharges are listed separately.

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Canceling Remittance Challans

Purpose

If for any reason an error occurs when you create a remittance challan, you use this function to cancel the challan and reverse the accounting document. This function does not work, however, if you have already entered the bank challan (see Entering Bank Challans).

Procedure


Withholding Tax → India → Extended Withholding Tax → Remittance of Withholding Tax → Cancel

Remittance Challan or Accounting → Financial Accounting → Accounts Receivable → Withholding Tax →

India → Withholding Tax for Payments to Customers → Remittance of Withholding Tax → Cancel Remittance Challan.

2. Specify which accounting document you want to reverse. This is the accounting document that the system created when you created the remittance challan.

3. Choose .

The system prompts you to specify what sort of reversal you want to make.

4. Choose Resetting and Reverse.

5. Enter a reversal reason and choose .

The system displays two dialog boxes, one with the number of the document posted. After you have closed the dialog box, you go back one screen to display a list of the documents that you have reversed.

Result

The system:

� Cancels the remittance challan

� Creates an accounting document to reverse the postings made when you create the remittance challan

Entering Bank Challans

Purpose When the bank sends you a bank challan, you enter the bank challan in the system. The system stores the bank challan number in all remitted withholding tax items by way of proof that you have remitted the tax.

Procedure

On the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Withholding Tax → India → Extended Withholding Tax → Remittance of

Withholding Tax → Enter Bank Challan or Accounting → Financial Accounting → Accounts

Receivable → Withholding Tax → India → Withholding Tax for Payments to Customers →

Remittance of Withholding Tax → Enter Bank Challan.

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Enter data as required, including:

� Organizational data, such as your company code

� Remittance challan number

� Bank challan details

Choose .

Result The system:

• Records the bank challan details in the remitted withholding tax items

This information will be included in the vendor withholding tax certificates when you print them.

• Displays a list of the updated items

Withholding Tax Certificates for Vendors and Customers

Use You must present your vendor or customer with a withholding tax certificate within 60 days of the business transaction.

You do not use the generic programs for printing withholding tax certificates. Instead, Country Version India offers two programs that you can use to print withholding tax certificates, one for vendors and one for customers.

Prerequisites You can only print the certificates once you have remitted the tax in question and entered the bank challans. Any other tax items will not be included in the certificates.

Features

Certificates

The programs print a separate certificate for each vendor or customer. Each certificate shows all the withholding tax items belonging to that vendor of customer. The items are listed according to their bank challan number, as required by law.

The program numbers the certificates, but only when you print the certificates directly, not in the print preview.

If you have had dealings with the same vendor or customer in more than one tax jurisdiction (tax office), the system prints a separate certificate for each tax office. The system allows you to print out the certificates on different SAPscript forms for every tax office and every section of the Income Tax Act, if required.

Credit Memos, Down Payments

The system deducts credit memos and down payments from the invoices that they belong to, if such information is available.

One-Time Accounts

For one-time vendors or one-time customers, only one business transaction is printed. The address details are taken from the appropriate document for the vendor or customer.

Separate programs are available for reprinting and canceling vendor certificates.

Activities

Customizing Make the Customizing settings for the programs in Customizing for Financial Accounting (FI), by choosing

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Financial Accounting Global Settings → Withholding Tax → Extended Withholding Tax → Postings → India → Vendor Withholding Tax Certificates.

Since you do not need the generic programs for printing withholding tax certificates, ignore the generic Customizing activities.

Deactivate certificate numbering in the withholding tax types.

Master Data

Maintain your section codes' address data, and maintain your customers' and vendors' PANs (see Vendor Master (Country Version India Data) and Customer Master (Country Version India Data)). This data will be printed out on the certificates.

Periodic Processing

You print vendor withholding tax certificates and customer withholding tax certificates once monthly or once annually as required.

If necessary, you can reprint and cancel withholding tax certificates for your vendors (but not for your customers).

Print Vendor Withholding Tax Certificates

Use You use this program to print out withholding tax certificates for vendors.

To access the program, on the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Payable → Withholding Tax → India → Extended Withholding Tax → Withholding Tax Certificates → Print.

Features

Selection


• Organizational information, for example, your company code

• The section code and withholding tax key that you want to create forms for

• Details of the bank challans that you want to cover

• Information that is to appear on the certificates

Output

The program:

• Prints out the certificates, numbered consecutively

• Displays a list of all the certificates printed, grouped by certificate, challan, and section code

Reprint Vendor Withholding Tax Certificates

Use

You use this program to reprint withholding tax certificates for vendors.

Note that you can only reprint one certificate at a time, and that you cannot reprint withholding tax certificates for customers.


Accounts Payable → Withholding Tax → India → Extended Withholding Tax → Withholding Tax Certificates → Reprint.

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Features

Selection

On the selection screen, enter data as follows:

� The company code

� The number and date of the original certificate

Cancel Vendor Withholding Tax Certificates

Use

You use this program to cancel withholding tax certificates for vendors.

Note that you cannot cancel withholding tax certificates for customers.


Accounts Payable → Withholding Tax → India → Extended Withholding Tax → Withholding Tax Certificates → Cancel.

Features

Selection


� Company code

� The number and date of the original certificate

Print Customer Withholding Tax Certificates

Use You use this program to print out withholding tax certificates for customers.

To access the program, on the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Receivable → Withholding Tax → India → Withholding Tax for Payments to Customers → Withholding

Tax Certificates → Print.

Features

Selection On the selection screen, enter the following data:

• Organizational information, for example, your company code

• The section code and withholding tax key that you want to create forms for

• Details of the bank challans that you want to cover

• Information that is to appear on the certificates

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Output

The program:

• Prints out the certificates, numbered consecutively

• Displays a list of all the certificates printed, grouped by certificate, challan, and section code

Withholding Tax Certificates from Customers

Use

You use this program to enter the withholding tax certificates sent to you by your customers.

When you enter a certificate, the system clears the withholding tax to a G/L account that records how much tax your customers have withheld on your behalf, known as the customer tax creditable account. You can offset this tax against your income tax payable at year-end.

You run the program immediately you receive a certificate from a customer.


Accounts Receivable → Withholding Tax → India → Tax Withheld by Customers → Enter Certificate.

Prerequisites

You have maintained the settings in Customizing for Financial Accounting (FI), by choosing Financial Accounting

Global Settings → Withholding Tax → Extended Withholding Tax → Postings → India → Withholding Tax Certificates from Customers.

Features

Selection


� Your company details

In the Section field, enter the official withholding tax key that you use for the section of the Income Tax Law in question.

� The numbers or posting dates of the documents that you want to clear

The certificate date serves as the posting date and the document date.

� The information from the certificate

When you execute the program, the system takes you to the standard clearing program. You then select which withholding tax line items are to be cleared.

Output

The system creates an accounting document to transfer the withholding tax from the G/L account for the withholding tax deducted by your customers to the customer tax creditable account.

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Activities

If you need to reverse the clearing document, you can do so using the standard reversal program.

Selecting Which Line Items to Clear

1. On the Post with Clearing: Process Open Items screen, choose . 2. Double-click the line item. 3. In the Amount field, enter the amount of withholding tax as specified on the tax certificate. 4. Save the change.

The system automatically goes back to the Post with Clearing: Process Open Items screen.

5. Double-click the amounts that you want to clear. 6. Save your entries.

Withholding Tax Information System

Use

You use this report to gather information relating to the withholding tax transactions that you have carried out. You can also use it for carrying out pending transactions like challan updates, bank challan updates, and certificate printing. You can display the individual documents (invoices, down payments, challan clearing documents) pertaining to withholding tax transactions. You can run this report at any stage in the withholding tax cycle in order to obtain the necessary information.

To access the report, from the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Withholding Tax → India → Extended Withholding Tax → Information System → Withholding Tax.

Features

Selection

On the selection screen, enter the selection criteria as required and specify which report you want:

� Challan Update Status

Displays a list of all documents involving withholding tax. For each document, it shows the tax amounts and whether or not the tax has been remitted.

� Bank Challan Status

Displays the bank challan update status (whether carried out or not) of all transactions for which challan updates have been carried out.

� Certificate Status

Displays the transaction details for which bank challans have been updated. It shows whether or not a certificate has been issued for the transaction.

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� Consolidated Report

Lists all documents involving withholding tax.

Activities

Each report contains functions for processing the documents in the list, as follows:

In the Challan Update Status report, you can create a remittance challan for various documents: Select the documents that you want to remit the tax on and choose Challan Update. The system takes you to the Create Remittance Challans program, which you then execute. However, you can only process documents for one withholding tax section at a time.

In the Bank Challan Status report, you can enter a bank challan: Select the documents (in this case identified by the internal challan numbers) that you have been sent a bank challan for and choose Bank Challan Update. The system takes you to the Enter Bank Challans program, which you then execute. However, you can only a single internal challan at a time.

In the Certificate Status report, you can print withholding tax certificates: Select the documents that you want to print a certificate for and choose Certificate Printing. The system takes you to the Print Withholding Tax Certificates program. However, you can only process documents for one withholding tax section at a time.

Transaction Codes for Extended Withholding Tax

TDS Returns

Use You use the TDS Returns report to generate electronic TDS returns for sections 194 A, C, D, I, and J of the Income Tax Act.

To access the report, on the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Withholding Tax → India → Withholding Tax or Extended Withholding Tax → Reporting → TDS Returns.

Transaction Code Action

J1INJV Enter journal vouchers

J1INPR Enter provisions for taxes on services received

J1INUT Reverse provisions for taxes on services received

J1INCHLN Create remittance challans

J1INREV Reverse remittance challans

J1INBANK Enter bank challans

J1INCERT Print withholding tax certificates for vendors

J1INREP Reprint withholding tax certificates for vendors

J1INCANC Cancel withholding tax certificates for vendors

J1INCC Print withholding tax certificates for customers

J1INCUST Enter withholding tax certificates from customers

J1INEFILE Prepare TDS returns

J1INMIS Withholding Tax Information System

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Use this report irrespective of whether you use the Classic TDS or the Extended Withholding Tax solution. If you have migrated from Classic TDS to Extended Withholding Tax during the course of the fiscal year, the report covers all withholding tax items that you posted under both solutions.

Prerequisites You have customized the withholding tax solution as described in Extended Withholding Tax or Classic Withholding Tax.

In particular, you have made the settings specifically for TDS returns in Customizing for Financial Accounting (FI),

by choosing Financial Accounting Global Settings → Withholding Tax → Extended Withholding Tax or

Withholding Tax → Reporting → India.

So that the report can handle reduced-rate taxes and exemptions under Sections 194, 197, and 197 A, you must have customized the withholding tax codes accordingly (see “See also” below).

Features Before you generate a TDS return, you can check which withholding tax items will be included in it. To do so, you generate a list using the report.

Note that the report only covers withholding tax items that you have remitted to the authorities and for which you have entered a bank challan in the system.

Selection

The selection screen breaks down as follows:

• Withholding Tax Datagroup box

Fill out either the EWT Section Code or the Withholding Tax (Classic) group box, depending on whether you use Extended Withholding Tax or Classic Withholding Tax. However, if you have migrated from Classic Withholding Tax to Extended Withholding Tax during the course of the fiscal year, fill out both group boxes.

• Statutory Signatory Details and Address Details tabs

Enter your company’s details. The report saves this data in the electronic TDS return.

• Output Processing Options tab

Specify whether you want to list the withholding tax items for inclusion in the return, or generate an electronic TDS return file, or both. If you want to generate a file, specify where you want the report to save it.

Output

Depending on what settings you make on the selection screen, the report:

• Lists the withholding tax items for inclusion in the TDS return

• Generates an electronic file at the location that you specify

See also:

Exemptions and Reduced Rates for Section 194 A

Exemptions and Reduced Rates Under Sections 197 and 197 A

Migration from Withholding Tax to Extended Withholding Tax

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Purpose

This procedure shows you how to migrate from the Classic Withholding Tax solution (Classic TDS) to its successor, Extended Withholding Tax.

In order for the existing documents involving with withholding tax items to be compatible with Extended Withholding Tax, you have to migrate the data. But before you can do so, you have make the appropriate Customizing settings, archive old documents, and so on. Follow the instructions given below.

Ensure that no one can post any documents in the company codes during the withholding tax changeover. We recommend that you block your system for all end users and carry out the conversion runs at the weekend.

You must also carry out the migration in a test system before you start work on your production system.

Process Flow

Preparations

1. You implement Logistics Invoice Verification. 2. You archive all of the cleared items. 3. You make the Customizing settings for Extended Withholding Tax. 4. You set up the authorizations for the Migration Program. 5. Just before you start the migration, you block the users from working in the system.

Migrating the Existing Transaction Data and Activating Extended Withholding Tax

1. Execute the Health Check Program 2. You map the Classic TDS tax codes to the Extended Withholding Tax types and codes. 3. You activate Extended Withholding Tax. 4. You maintain your vendor master records. 5. You migrate the documents.

Cleaning Up

You clean up the system.

Implementing Logistics Invoice Verification (MM-LIV)

Use

The customer carries out this step.

Classic TDS supports conventional invoice verification and Logistics Invoice Verification (MM-LIV) while Extended Withholding Tax supports only Logistics Invoice Verification. After you have migrated, you cannot use conventional invoice verification anymore.

If you do not use invoice verification of any kind, you do not need to take any action.

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Procedure

Make the Customizing settings for Logistics Invoice Verification in the Implementation Guide (IMG) for Materials

Management, by choosing Invoice Verification → Logistics Invoice Verification.

Archiving Cleared Items


Archive as many cleared items as you can. Documents that have already been archived are not converted, so you can considerably reduce the time required for the conversion run by doing so.

The number of cleared items managed in a system is usually much greater than the number of open items. If, for example, a system contains a hundred times more cleared items than open items, it will take a hundred times longer to convert the cleared items than to convert the open items.

For more information about archiving documents, see the SAP Library under Cross-Application Components � Archiving Application Data (CA-ARC) � Financial Accounting (FI) � Archiving Financial Accounting Data (FI) �

Archiving FI Documents .

Procedure

1. From the SAP Easy Access screen, choose Accounting � Financial accounting � General ledger (or Accounts receivable or Accounts payable) � Periodic processing � Archiving � Documents.

2. Archive the required cleared documents.

Customizing Extended Withholding Tax

Use

The customer carries out these steps.

Before you start the conversion of the withholding tax data, you must set up Extended Withholding Tax in the Implementation Guide for Financial Accounting. Make the system settings described below.

Do not activate Extended Withholding Tax yet.

If you activate Extended Withholding Tax before converting the withholding tax data, documents could be posted with Extended Withholding Tax. This could result in your system containing documents with both classic withholding tax and Extended Withholding Tax which, in turn, could lead to serious problems when you migrate the documents.

Procedure

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1. Define the official withholding tax keys. 2. Define the withholding tax types and withholding tax codes. 3. Define the minimum and maximum amounts per type and code. 4. Make any additional settings.

Defining Official Withholding Tax Keys

1. In the Implementation Guide for Financial Accounting, choose Financial Accounting Global Settings →

Withholding Tax → Extended Withholding Tax → Basic Settings → Define Official Withholding Tax Codes. 2. Define the official withholding tax keys (also known as official withholding tax codes) for reporting

withholding tax. For example, define the keys for the various sections of the Income Tax Act, 1961.

Defining Withholding Tax Types and Withholding Tax Codes

Use

Define all types and codes that you require for all countries that you want to implement Extended Withholding Tax in.

Procedure

Defining Withholding Tax Types

1. In the Implementation Guide (IMG) for Financial Accounting (FI), choose Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Calculation → Withholding Tax Type. 2. Make the necessary settings for the required withholding tax types in the following activities:

a. Define Withholding Tax Type for Payment Posting, and if necessary, Define Withholding Tax Type for Invoice Posting

b. Define Rounding Rule for Withholding Type c. Assign Condition Type to Withholding Tax Type

Defining Withholding Tax Codes

1. In the IMG for FI, choose Financial Accounting Global Settings → Withholding Tax → Extended

Withholding Tax → Calculation → Withholding Tax Codes → Define Withholding Tax Codes. 2. If any of the withholding tax codes use formulas to calculate withholding tax, you must also carry out the

activity Define Formulas for Calculating Withholding Tax.

Defining Minimum and Maximum Amounts

Use

Define, if necessary, the minimum and maximum amounts for the withholding tax codes and types that you have defined.

Procedure

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1. In the Implementation Guide for Financial Accounting, choose Financial Accounting Global Settings →

Withholding Tax → Extended Withholding Tax → Calculation → Minimum and Maximum Amounts. 2. To define the minimum and maximum amounts for the withholding tax types, choose Define or Maintain

Min/Max Amounts for Withholding Tax Types. 3. To define the minimum and maximum amounts for the withholding tax codes, choose Define or Maintain

Min/Max Amounts for Withholding Tax Codes.

Making Additional Settings

Now that you have defined the withholding tax codes and types, make the remaining settings, including:

� Define the recipient types you need for your vendors and attach them to the appropriate vendor master records.

� Make the account determination settings.

� Specify for each company code which withholding tax types they are allowed to withhold tax for.

Do not activate Extended Withholding Tax yet.

Setting Up Authorizations for Migration

Use


In this activity, you create authorization profiles for the people involved in the withholding tax migration. In order to execute the Migration Program, you require the role TDS Supervisor or the authorization object J_1IEWTJV, provided by SAP.

Once the withholding tax migration is completed, take the precaution of withdrawing the change authorization for all the users involved. This prevents the conversion being started while the system is being used for normal day-to-day activities, for example.

Procedure

1. In the Implementation Guide for Financial Accounting, choose Financial Accounting Global Settings → Maintain Authorizations.

2. Make the required Customizing settings.

The authorization object J_1IEWTJV is in the India Version object class under the object name Authorization Check for JV.

Blocking Users


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Use

You must block the system for normal activities while the conversion is being prepared and carried out. Documents must not be posted or processed, and master data must not be changed, otherwise your accounting documents and system settings may contain serious discrepancies.

Procedure

1. Ensure that all users involved in the withholding tax changeover have the appropriate access authorizations.

2. Block your SAP System for all other users.

If it is not possible to take measures to ensure that there are no users working in the system, you should block the users and the whole system throughout the organization.

Restart the SAP System so that all users are logged off.

Withholding Tax Migration Health Check

Use You must execute this report before you proceed with the Migration Program. It makes sure that all the Customizing settings have been made properly (for a list of the checks, see under Activities below), so that the Migration Program will migrate the data correctly. Additionally, the report also displays a list of the documents that you will not be able to process any more after the migration.

You must run the report for each company code that you want to carry out the migration for, and the health check status for each company code must be OK.

Prerequisites You have carried out all the activities described under Preparations in Migration from Classic TDS to Extended Withholding Tax.

Features To access the report, in Customizing for Financial Accounting (FI), choose Financial Accounting Global Settings

→ Withholding Tax → Withholding Tax Changeover → Withholding Tax Changeover India → Health Check.

Selection


• Selection Criteria

� Specify which country and which company code you want to perform the health check for. You can only execute the report for one company code at a time.

� Specify whether you want to run all checks, or just the obligatory ones. We recommend that you perform all of the checks.

• Document Details

In this group box, you specify which sorts of documents you want the report to cover, and from which dates.

• Other Checks

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Specify whether you want the vendor master records to be checked, and the tax code mapping from Classic TDS to Extended Withholding Tax.

Output The output list shows:

• The results of the Customizing checks

• The documents that cannot be processed after the migration

• The results of the vendor master checks

• The results of the checks on the tax code mapping

The key is as follows:

Process all of the activities marked , , or , and execute the report again. Only when all activities are

marked or will the report assign the company code the status OK.

Activities The report makes the following checks at country level:

• Withholding tax country

• Official withholding tax key

• Withholding tax types

• Withholding tax codes

• Recipient types

• Tax due dates

• Rounding rules

• Business transaction events

And these at company code level:

• Company code global parameters

• Extended Withholding Tax has been activated

• Withholding tax codes are assigned to company code

• Accounts for withholding tax to be paid over have been defined

• Accounts for posting withholding tax and losses to be paid

• Clearing accounts liable to withholding tax

• Section codes have been defined

• Factory calendar has been assigned to section codes

• Creation of remittance challan

• Vendor withholding tax certificates

• Vendor master data

• Surcharge calculation

Indicator Meaning

One check has been run on an obligatory Customizing activity, and the settings are incorrect

One check has been run on an optional Customizing activity, and the settings are incorrect

One check has been run on an obligatory Customizing activity, and the settings are correct

Multiple checks have been run on an obligatory Customizing activity, and some of the settings are incorrect

Multiple checks have been run on an obligatory Customizing activity, and all of the settings are correct

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Mapping Withholding Tax Types and Withholding Tax Codes

Use

You map the Classic TDS withholding tax codes to the Extended Withholding Tax withholding tax types and codes.

Procedure

1. From any screen, choose System → Services → Table maintenance → Extended Table Maintenance.

2. Enter table J_1IEWT_MIGRATE and choose Maintain. 3. Map the Classic TDS tax codes to the Extended Withholding Tax tax types and codes. 4. Save your entries.

Activating Extended Withholding Tax

Use

The customer carries out this step just before you migrate the data.

Procedure

1. In the Implementation Guide (IMG) for Financial Accounting (FI), choose Financial Accounting Global

Settings → Withholding Tax → Extended Withholding Tax → Company Code → Activate Extended Withholding Tax.

2. Activate Extended Withholding Tax for each company code whose data you want to migrate.

Maintaining Vendor Master Records

Use

Here, you specify which withholding tax types apply to each vendor.

Under Extended Withholding Tax, you can assign any number of withholding tax types to a vendor’s master record. When you come to make a posting involving withholding tax for this vendor, you can then enter withholding tax for each withholding tax type that you have assigned it.

Make sure the withholding tax types in the vendor master record match those in the mapping table: When, during migration, the system converts the various documents (for example, payments), it replaces any Classic TDS withholding tax types with the Extended Withholding Tax types and codes that entered in the mapping table. However, it does not cross-check the withholding tax type against the appropriate vendor master record. If, during migration, the Migration Program assigns a document a withholding tax type that you have not assigned to the vendor, you will not be able to process the document afterwards.

Prerequisites

Just before you start maintaining the vendor master records, activate Extended Withholding Tax for the company code in question. Otherwise, the system will not display the appropriate fields. As soon as you have finished,

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deactivate it.

Procedure

Make the changes in the vendor master records of all vendors that you have to withhold tax on. For each vendor:

� Enter the relevant withholding tax types

� Enter the relevant withholding tax codes and select Liable, in order to activate it

� Enter the recipient type

� Enter any exemption information

Withholding Tax Data Migration Tool

Use This program converts documents created under the Classic TDS solution so that they are suitable for use with Extended Withholding Tax. For example, after you have migrated to Extended Withholding Tax, neither the Payment Program nor the Clearing Program will be able to work with Classic TDS documents.

This program migrates all documents involving withholding tax, such as invoices, down payments, down payment clearing documents, and TDS documents. After the migration, the system will treat them as though they were created using Extended Withholding Tax.

Integration The program contains two user exits:

• Selecting the section code

The section code is mandatory in down payments that are to be migrated. You can either enter them by filling out the selection screen or using the user exit. The user exit provides the section code, business area, company code, and TAN number as input parameters. The appropriate section code can be derived from this information.

• Data selection and validation

There are two user exits available to choose and validate additional clearing documents and down payment documents.

Prerequisites You have carried out all the steps in Migration from Classic TDS to Extended Withholding Tax under Preparations and steps 1–4 under Migrating the Existing Transaction Data and Activating Extended Withholding Tax. You cannot go back and complete these steps after you have migrated the documents.

In order to execute the program, you must have the role TDS Supervisor.

Features To access the program, in Customizing for Financial Accounting (FI), choose Financial Accounting Global

Settings → Withholding Tax → Withholding Tax Changeover → Withholding Tax Changeover India → Migration Program.

First check the documents to see if they will be migrated properly, and edit any that result in problems. Then, when all the documents have been checked, migrate them.

Selection


• Selection Criteria

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In this group box, specify which documents you want to migrate. If you enter invoice document numbers, the system picks up the associated clearing documents.

• Additional Selection Criteria

Use these fields to refine your selection. If you need to migrate a large number of documents, we recommend that you process one small quantity at a time in order to improve performance.

• Migration of Down Payments

If you want to migrate down payments, select this option. If you do, you must enter a section code or have it defaulted by means of a user exit.

• Posting Run

Select this indicator to execute the program in test mode.

Output

In the result screen, verify the invoices and credit memos and check them. Down payments are only migrated after you have checked them from the screen.

If you want to migrate down payments, the list shows all the open down payments. You then have to select the down payments and save them for migrating the data.

You can migrate invoices, credit memos, clearing documents, and TDS documents on the above live or previewed.

Activities Migrate invoices, credit memos, clearing documents, and TDS documents if you have not yet paid the vendor or if the payment is likely to be reversed. You must decide before you start on the migration if this is likely or not. Do not migrate the documents if the vendor has been paid and it is unlikely that you will have to reverse the payment.

Migrate all open down payments so that tax adjustment on down payment clearing could happen along with clearing. Decide on the appropriate section code entity to which the down payments pertain and choose from the list displayed.

If the status of a document changes, you execute the program again. For example, say that you have migrated an invoice. If you then post TDS later on, you must migrate the invoice again so that the TDS document is also migrated.

When you come to run the Automatic Payment Program and the error Inconsistent withholding tax information occurs for a line item, one of the reasons could be that the line item is not migrated.

Checking the Documents

Use

In this step, you execute the report in test mode. The system:

� Shows you how many vendor items, open items, and cleared items it has found in the company code that match your selection criteria

� Shows you how many vendor items and so on there are per Extended Withholding Tax code

� Checks the assignment of the Classic TDS withholding tax codes to the Extended Withholding Tax types and codes to see whether the characteristics of each combination of type and code for extended withholding tax correspond

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Procedure

1. Fill out the selection screen, making sure that you have selected Test run for invoice/credit memo, and

choose .

The output list appears, with a list of the documents selected and any warnings.

2. Check the documents for any discrepancies that could lead to problems later on, when you make postings for Extended Withholding Tax:

� Check whether any documents are missing withholding tax codes.

If so, check whether the codes have been deleted by mistake, in which case you have to make the relevant system settings again, or whether you intentionally wanted the tax code to be deleted.

� Check whether any withholding tax codes exist that have not been used, and delete them.

� Check down payments to see if the migrated base and tax are correct.

3. Correct any errors and execute the report again.

Migrating the Documents

Use

In this step, you execute the report in update mode. The system migrates the documents from Classic TDS to Extended Withholding Tax. Note that this is the most time-consuming step.

Procedure

1. Fill out the selection screen, making sure that you have deselected Test run for invoice/credit memo, and

choose .

The output list appears, with a list of the documents selected and any warnings.

2. In the list, select the down payments that you want to migrate and save.

This procedure does not apply to any other types of documents.

Cleaning Up

Use

Once you have migrated the documents, there is some cleaning up to do in the sytem:

Procedure

1. Check the Customizing settings for Extended Withholding Tax. 2. Check, edit, and save any of the following, which the Migration Program does not handle:

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� Recurring entry documents

� Sample documents

� Noted items

3. Release the system

Once you have finished the migration and cleaning up activities, release the system for the users.

General Ledger Accounting (FI-GL)

Purpose

The General Ledger (FI-GL) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component. For generic information about FI-GL, see

General Ledger Accounting (FI-GL).

Features

The country template for India comes with its own chart of accounts and a financial statement version.

Chart of Accounts

Definition

See Chart of Accounts.

Use

The country template for India comes with its own chart of accounts, CAIN.

It contains all accounts common to most businesses in India. It also takes into account the requirements of Schedule VI of the Companies Act 1956.

The country template also contains settings for automatic accounting postings in most components, with the exception of Controlling (CO).

Financial Statement Version

Definition

See Financial Statement Version.

Use

The country template for India comes with its own financial statement version, BAIN. You can use it to prepare financial statements in accordance with Schedule VI of the Companies Act 1956. This act lists the headings under which the individual accounts are to be grouped. Each of the headings is represented by an item in the financial statement version.

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Purpose

The Accounts Payable (FI-AR) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component. For generic information about FI-

AP, see Accounts Receivable and Accounts Payable: Overview.

Features

Country Version India comes with a number of functions relating to withholding tax (see link below).

Extra fields are available in the vendor master data for information required in India only.

See also:

Withholding Tax

Vendor Master (Withholding Tax Data)

Definition The part of the vendor master record where you record information about which taxes you have to withhold from payments to a vendor.

For generic information about withholding tax data in the vendor master, see Defining Liability to Tax and Authorization to Deduct Tax.

To access the vendor master, on the SAP Easy Access screen, choose Accounting → Financial Accounting →

Accounts Payable → Master Records → …

Use Enter the withholding tax types and withholding tax codes that the vendor is liable to, and for each entry, enter the recipient type, depending on whether the vendor is a legal person or a natural person.

See also:

Vendor Master (Country Version India Data)

Vendor Master (Excise Data)

Entering Vendor Invoices

Use

In India, when you enter a vendor invoice in Accounts Payable (FI-AP), you follow the standard procedure and, in addition, you assign the invoice to the appropriate section code.

Procedure

1. From the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Document Entry → Invoice.

2. Enter the header data as required, including:

� Bus. Place/Sectn: Your section code.

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3. Enter other data and save the invoice.

Result The system:

• Creates an accounting document with the necessary withholding tax items (including surcharges)

• Assigns all vendor items and withholding tax items to the section code that you have entered

• Assigns each withholding tax item a tax due date, which it enters in the Value Date field (which is not shown on the user interface)

When the time comes, you must:

• Remit the withholding tax

The system automatically selects which withholding tax items need to be remitted on the basis of their tax due date.

• Create a withholding tax certificate for the vendor

If you post the wrong amount of tax or you have posted the tax using the wrong official withholding tax key, you can enter a journal voucher to reverse the posting.

Entering Vendor Down Payments

Use

In India, when you enter a vendor down payment in Accounts Payable (FI-AP), you follow the standard procedure and, in addition, you:

• Assign the down payment to the correct section code

• Calculate any withholding tax required

Procedure

1. On the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts

Payable → Document Entry → Down Payment → Down Payment.

2. On the Header Data screen, enter the header data as required and choose

3. On the Add Vendor Item screen, enter data as required, including:

− Bus. Pl. (Business Place): The section code handling the down payment

4. Save the down payment.

Result The system creates an accounting document with the appropriate withholding tax items. It enters the business

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place in each vendor item and each withholding tax item.

Clear Invoices Against Down Payments

Use If you withhold tax on a vendor down payment, and the vendor then sends you an invoice, you have to clear the withholding tax when you have entered the invoice (not when you pay the invoice, as is customary in other countries).

Features

This function has been incorporated into the standard function for clearing down payments (see Clearing). When you clear an invoice against a down payment for an Indian company code, the system clears the withholding tax automatically, if the company code is located in India.

Activities

Customizing

In order for the tax to be cleared correctly, you must post the down payments using:

• A withholding tax type that is marked as Central Inv. Prop. (Central invoice proportionate)

• A withholding tax code that uses the posting indicator 1 (Standard posting: bank/vendor/customer line item reduced)

If you use either of the other two methods, the adjustment will be made against the offsetting account instead of the vendor account.

Day-to-Day Activities Make sure that the withholding tax codes you use when you enter the down payment and the invoice are assigned to the same withholding tax key, otherwise the clearing program will not let you clear them.

Once you have posted the vendor invoice, clear the down payment against it. To access the function, on the SAP

Easy Access screen, choose Accounting → Financial Accounting → Accounts Payable → Document Entry →

Down Payment → Clearing.

Example

A vendor provides you with some services, for which it promises to send you an invoice in a few days' time.

In the meantime, you make a down payment on the services for a total of INR 10,000, presenting the vendor with a check for INR 9,796 and withholding the remaining INR 204 as tax:

A week later, the vendor sends you the invoice, for a total of INR 20,000 – on which you have to withhold a total of INR 408. You post the invoice as normal, which gives the following accounting document:

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You then clear the invoice against the down payment. The system takes into account the INR 204 of tax that you have already withheld, and creates the following accounting document to clear the down payment against the invoice, and clear the withholding tax account:


Purpose

The Accounts Receivable (FI-AR) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component. For generic information about FI-

AR, see Accounts Receivable and Accounts Payable: Overview.

Features

Country Version India comes with a number of functions relating to withholding tax (see link below).

Extra fields are available in the customer master data for information required in India only.

See also:

Withholding Tax

Customer Master (Withholding Tax Data)

Definition

The part of the customer master record where you record information about which taxes you have to withhold from payments to a customer.

To access the customer master, from the SAP Easy Access screen, choose Accounting → Financial

Accounting → Accounts Receivable → Master Records → …

For generic information about withholding tax data in the customer master, see Defining Liability to Tax and Authorization to Deduct Tax.

Use

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Enter the withholding tax types and withholding tax codes that the customer is liable to.

Enter the recipient type in the W/Tax No. (Withholding Tax Number) field.

See also:

Customer Master (Country Version India Data)

Customer Master (Excise Data)

Asset Accounting (FI-AA)

Purpose

The Asset Accounting (FI-AA) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component. For generic information about FI-

AA, see Asset Accounting (FI-AA).

Features


Country Version India comes with a report for calculating depreciation on asset blocks (asset groups) as required by law for calculating a company's taxable income.

Country Template

The country template for India comes with the following settings:

� Chart of depreciation

� Depreciation keys as per the income tax laws

For more information, see the following documentation.

Year-End Income Tax Depreciation Report

Use

You use this report to calculate the depreciation on your assets and any capital gains or losses according to the Income Tax Act.

To access the report, from the SAP Easy Access screen, choose Accounting → Financial Accounting → Fixed

Assets → Information System → Reports on Asset Accounting → Taxes → Country Specifics → India → Year-End IT Depreciation Report.

Prerequisites

You can use the Customizing settings delivered by SAP in order to configure Asset Accounting (FI-AA) with respect to the income tax depreciation area and so that the report works correctly. For more information about

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what settings to make, see the Release Note structure under FI → Release Notes from Country Version India

Add-On → Customizing Settings for Income Tax Act.

Features

Selection

Enter the asset numbers of your group assets and other selection data as required.

Output

The system:

� Calculates the depreciation on each asset block � Calculates any capital gains or losses

If you deselect Test Run, the system also:

� Posts the depreciation to the income tax depreciation area

� Stores the capital gains amounts from the report in a table for your future reference.

Calculation of Depreciation

Use

The program calculates the depreciation on each asset block according to the Income Tax Act.

Features

Depreciation of Asset Blocks

The Income Tax Act requires you to depreciate all assets in blocks (in the SAP System, called asset groups). In other words, you do not calculate the depreciation on each individual asset. Instead, an asset group has its own net book value.

The asset block’s net book value increases when you add assets to it and falls when you sell or retire assets. You also calculate depreciation on the block’s net book value. The depreciation rate depends on the asset block and is prescribed by the government. Since an asset block may exist for a very long time, as you add new assets to it, it has an unrestricted useful life.

For example, assume your company has four trucks. At the beginning of fiscal 20X1, the trucks have a total net book value, for income tax purposes, of INR 300,000. At the end of the year, with no acquisitions and no retirements, the net book value has not changed. The total depreciation on all of the trucks is 10% of INR 300,000, or INR 30,000.

The total net book value of the block at the beginning of 20X2 is therefore INR 270,000.

New Assets Held for Less Than 180 Days

If you purchase an asset less than 180 days before the end of the fiscal year, you are only entitled to depreciate it at half of the normal rate of depreciation. To continue the example, on 1 June 20X2 you sell a truck for IN 30,000.

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On 31 March the following year, instead of posting INR 3,000 depreciation, you can only post half of that, INR 1,500.

The system handles this requirement by taking half the acquisition cost and calculating depreciation on that.

Asset Retirements

When you retire an asset, you are not entitled to calculate any depreciation on it in that fiscal year at all.

Calculation of Capital Gains or Losses on Sales of Assets

Use

The system automatically calculates any gains of losses on sales of assets according to the Income Tax Act. Any gains or losses have to be taxed.

Features

If you sell an individual asset from a block, the value of the asset block goes down by the sale price. For example, assume that you have an asset block of trucks. On 1 April 20X2, the trucks’ total net book value is INR 270,000. On 1 February 20X3 you sell one of the trucks for INR 50,000. At the end of the year, the net book value before depreciation is therefore INR 220,000.

Capital Gains

If the sale of an asset causes the value of the asset block to fall below zero, the amount below zero constitutes a capital gain under the terms of the Income Tax Act. For example, on 1 April 20X3 the trucks’ total net book value is INR 198,000. On 1 December you sell a truck for INR 210,000. On 31 March 20X4 the system determines the asset block’s net book value as:

INR 198,000 – INR 210,000 = – INR 12,000

This makes a capital gain of INR 12,000, which the system stores in a table for your future reference.

The following year, the net book value of the asset block is set to zero.

Capital Losses

If you sell all the assets in a block, but the block still has a net book value, the system posts this value as a capital loss. For example, if you have a block with only one asset valued at INR 12,000, and you sell it for INR 10,000, the net book value of the block is still INR 2,000, even though there are no assets in it.

The system stores the capital loss amount in a table for your future reference.

Materials Management (MM)

Purpose The Materials Management (MM) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component.

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Features


Country Version India comes with functions for calculating, posting, remitting, and reporting excise duty, and for handling incoming and outgoing excise invoices.

For these purposes, extra fields are available in the vendor master data and material master data for information required in India only.

Country Version India offers two ways of calculating excise duty, a condition-based method and a formula-based method.

You can enter incoming excise invoices in the SAP system for goods receipts arising from external procurement, subcontracting, and stock transfer. Excise clerks can capture incoming excise invoices using a dedicated transaction, or, alternatively, warehousemen can capture them in the standard Goods Movement transaction, MIGO, when they enter a goods receipt.

Finally, you can prepare copies of all excise registers for submission to the excise authorities.

Country Template

The country template for India comes with settings for calculating and posting all forms of taxes from MM, and with the necessary document copying control settings.

Excise Invoice (Incoming)

Definition A business document, in India, that your vendor sends you when it delivers excisable goods. It lists the goods and states how much excise duty applies on them. Your use the excise invoice to claim back the excise that you have paid from the excise authorities.

Use When you procure goods externally, each delivery that your vendors make is accompanied by an excise invoice. You have to post these in the system. This document is required as proof of the excise duty that you have paid, so that you can then offset the duty against the excise duty that you levy on outputs.

You can capture and post excise invoices in one or two steps, depending on your business requirements.

• In the two-step procedure, the excise clerk captures the incoming excise invoice. This means that the clerk enters the data, but the system does not yet create an entry in Part II of the appropriate excise register. Another user (the excise supervisor) checks the excise invoice and posts it. The system then creates a Part II entry.

• In the one-step procedure, the excise clerk captures and posts the incoming excise invoice simultaneously. The system creates the Part II entry automatically.

Generally speaking, you have one excise invoice for each goods receipt, but see also Multiple Goods Receipts for a Single Excise Invoice.

Structure In the SAP system, the excise invoice consists of header data and line items. The header data comprises:

• An internal number

• The excise invoice number

• The date of the excise invoice

• The details of the original vendor who generated the excise invoice, if your vendor purchased the goods from another vendor and was merely selling them on to you

At line item level, the excise invoice lists the materials on the excise invoice, showing the following information:

• Chapter ID

• Quantity of materials

• Excise duty base amount

• Rates of excise duty

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• Amount of duty paid

Material Master (Excise Data)

Definition

The part of the material master record where you record excise information.

To access the material master, from the SAP Easy Access menu, choose Logistics → Materials Management →

Material Master → Material → …

The excise data is displayed in a separate group box on the Foreign Trade: Import Data and Foreign Trade: Export Data tabs.

Use

Customizing

In order for the users to be able to see the excise data group box, carry out the IMG activity in Customizing for

Logistics – General, by choosing Taxes on Goods Movements → India → Master Data → Assign Users to Material Master Screen Sequence for Excise Duty.

Vendor Master (Country Version India Data)

Definition

The part of the vendor master record where you record information about a vendor relating to sales tax, excise duty, and withholding tax.

To access the vendor master, from the SAP Easy Access screen, choose Logistics → Materials Management →

Purchasing → Master Data → Vendor → Central → ….

Use

When you have entered the vendor that you want to process, you can access the excise data from every screen, by choosing CIN Details.

There are three separate tabs, one for each sort of tax.

If you prefer, you can also maintain this data in the Excise Rate Maintenance transaction (see Vendor Master (Excise Data)).

Condition-Based Excise Determination

Use When you enter a purchasing document, for example, a purchase order, the system automatically calculates the applicable excise duties using the condition technique.

Features

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The standard system comes with two tax calculation procedures. TAXINN is only supports condition-based excise determination, whereas TAXINJ supports condition-based excise determination and formula-based excise determination.

Both tax procedures contain condition types that cover all of the excise duties and sales taxes applicable.

Since the exact rates of excise duty can vary on a large number of factors, such as which vendor you purchase a material from, or which chapter ID the vendor stocks the material under, you create condition records for every sort of excise duty.

When you come to enter a purchasing document, the system applies the excise duty at the rates you have entered in the condition records.

Activities

Customizing

Make the settings in Customizing for Logistics – General, by choosing Taxes on Goods Movements → India →

Basic Settings → Excise Duties Using Condition Technique and … → Account Determination.

These activities include one activity where you define a tax code for condition-based excise determination.

Master Data

Create condition records for all excise duties that apply, and enter the tax code for condition-based excise determination in each.


When you enter a purchase order or other purchasing document, enter the tax code for condition-based excise determination in each line item. The system then calculates the excise duties using the condition records you have created.

When the ordered materials arrive, you post the goods receipt and the excise invoice. The system posts the excise duty to the appropriate accounts for deductible input taxes when you enter the excise invoice.

Creating Condition Records for Excise Duty

1. In the command field, enter FV11 and choose .

2. Enter the condition type that you want to create a condition record for and choose .

The Key Combination dialog box appears.

3. Select the combination of objects that you want to create the condition record for.

On the dialog box, Control Code means "chapter ID."

So, for example, to create a condition record for a tax that applies to a combination of country, plant, and chapter ID, select Country/Plant/Control Code.

4. Choose . 5. Enter data as required.

In the Tax Code field, enter the dummy tax code that you have defined.

6. Save the condition record.

Configuration of Tax Calculation Procedure TAXINN

Purpose

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TAXINN is a tax calculation procedure for country version India and it supports condition-based excise determination. You need to configure this tax calculation procedure.

Process Flow Execute the following steps in the Implementation Guide to configure the tax calculation procedure TAXINN:

Procurement

Set up the following Access Sequences in the the IMG under Financial Accounting → Financial

Accounting Global Settings → Tax on Sales/Purchases → Basic Settings → Check Calculation

Procedure → Access Sequences:

� JTAX

� JST1

Set up the Condition Types for the following conditions in the IMG under Financial Accounting →

Financial Accounting Global Settings → Tax on Sales/Purchases → Basic Settings → Check

Calculation Procedure → Define Condition Types:

○ MM Excise Conditions

� JMOP IN: BED setoff %

� JMOQ IN: BED setoff Qty

� JAOP IN: AED setoff %

� JAOQ IN: AED setoff Qty

� JSOP IN: SED setoff %

� JSOQ IN: SED setoff Qty

� JMIP IN: BED inventory %

� JMIQ IN: BED inventory Qt

� JAIP IN AED inventory %

� JAIQ IN AED inventory Qty

� JSIP IN SED inventory %

� JSIQ IN SED inventory Qty

� JMX1 IN: A/P BED setoff

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� JAX1 IN: A/P AED setoff

� JSX1 IN: A/P SED setoff

� JMX2 IN: A/P BED inventor

� JAX2 IN: A/P AED inventor

� JSX2 IN: A/P SED inventor

� JECP IN:A/P e-cess setoff

� JECI IN: Eces inventory

� JEX1 IN: A/P ecs setoffT

� JEX3 IN: A/P ecs invT

○ LST/CST/VAT Conditions

� JIPS IN Sales tax setoff

� JIPC IN Central sales tax invoice

� JIPL IN Local sales tax invoice

� JIP5 A/P RM Deductible

○ Service Tax Conditions

� JSRT A/P Service Tax

� JEC3 A/P ECS for ST

Define the Tax Procedure according to the settings in the figures below.

You can do this in the IMG under Financial Accounting → Financial Accounting Global Settings

→ Tax on Sales/Purchases → Basic Settings → Check Calculation Procedure → Define Procedures.

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Set up the following Account Key in the IMG under Financial Accounting → Financial Accounting

Global Settings → Tax on Sales/Purchases → Basic Settings → Check and Change Settings for Tax Processing.

○ VS6 Input Tax

Assign Tax Procedure to the country.


→ Tax on Sales/Purchases → Basic Settings → Assign Country to Calculation Procedure.

Sales

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○ Excise Conditions

� JASS IN A/R BED

� JEXP IN A/R BED

� JEXQ IN A/R BED

� JEAP IN A/R AED %

� JEAQ IN A/R AED Qty

� JESP IN A/R SED %

� JESQ IN A/R SED Qty

� JCEP IN A/R CESS %

� JCEQ IN A/R CESS Qty

� JEXT IN A/R BED total

� JEAT IN A/R AED total

� JEST IN A/R SED total

� JCET IN A/R CESS total

� JECT IN A/R ECS total


� JCST IN A/R CST

� JCSR IN A/R CST Surcharge

� JLST IN A/R LST

� JLSR IN A/R LST Surcharge

○ Export Conditions

� JFRE IN Frieght

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� JINS IN Insurance

Set up the Access Sequence in the the IMG under Financial Accounting → Financial Accounting

Global Settings → Tax on Sales/Purchases → Basic Settings → Check Calculation Procedure

→ Access Sequences:

Set up the following Pricing Procedures according to the settings in the figures below.

You can do this in the IMG under Sales and Distribution → Basic Functions → Pricing → Pricing

Control → Define And Assign Pricing Procedures.

○ JDEPOT (IN:Depot sale with formula)

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○ JEXPOR (IN:Export sales with formula)

○ JFACT (IN:Factory sale with formula)

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○ JSTKTR (IN:Stock transfer with formula)

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Formula-Based Excise Determination

Use

When you execute a business transaction involving materials that are subject to excise duty, the system automatically calculates the duty for you.

Prerequisites

In order for the system to be able to determine which rate of excise duty to apply, you must have maintained all the data on the Excise Rate Maintenance screen, which you can access from the SAP Easy Access screen by

choosing Indirect Taxes → Master Data → Excise Rate Maintenance.

You maintain the following types of data:

� Plant master data

You assign each of your plants an excise duty indicator. You can use the same indicator for all the plants with the same excise status from a legal point of view, such as all those that are in an exempt zone.

See also the information about manufacturers that are only entitled to deduct a certain portion of the duty (see Partial CENVAT Credit).

� Vendor master data

For each of your vendors with the same excise status from a legal perspective, you define an excise duty indicator. You must also specify the vendor type – for example, whether the vendor is a manufacturer, a depot, or a first-stage dealer. You must also stipulate if the vendor qualifies as a small-scale industry.

For each permutation of plant indicator and vendor indicator, you then create a final excise duty indicator.

� Customer master data

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Similarly, you assign the same excise duty indicator to each of your customers that share the same legal excise status.

Again, for each permutation of plant indicator and customer indicator, you then create a final excise duty indicator.

� Material master data

Each material is assigned a chapter ID.

� Excise tax rate

For every chapter ID and final excise duty indicator, you maintain the rate of excise duty.

If your business only qualifies for partial CENVAT credit, you must customize your system accordingly.

Activities

Let us consider an example to illustrate how the system determines which rate of excise duty to apply to a material. Assume you are posting a sale of ball bearings to a customer. The system automatically determines the rate of excise duty as follows:

1. Looks up the customer master data to see what status you have assigned the customer.

Let's assume you've assigned the customer status 3.

2. Looks up the plant master data to see what status you have assigned the plant.

Similarly, your plant has status 2.

3. The system looks up the table under Excise Indicator for Plant and Customer to see what the final excise duty indictor is for customer status 3 and plant status 2: It is 7.

4. The system determines the chapter ID of the ball bearing for the plant.

Let’s assume the chapter ID at plant for the ball bearings is 1000.01.

5. Finally, the system looks up the table under Excise Tax Rate to see what rate of duty applies to chapter ID 1000.01 under status 7.

Material Master (Excise Data)

Definition

The part of the material master record that contains information relating to Indian excise duty.

Use

In conjunction with other data, this data is used to calculate excise duty on various transactions.

To maintain the data, from the SAP Easy Access screen, choose Indirect Taxes → Master Data → Excise Rate Maintenance, and then select the following options described below.

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Structure

The excise part of the material master is divided into the following screens:

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.

Material and Chapter ID Combination

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

� Chapter ID

� Whether the material can be sent to subcontractors (see Subcontracting) � The material type

This denotes, for example, whether the material is a raw material, a capital good – this affects the CENVAT process – 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.

� 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.

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.

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.

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.

You can maintain the basic excise rates in the following forms:

� Ad valorem � Specific � As a combination of both

For each rate, specify until which date it applies.

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You can also maintain the additional excise duty and special excise duty in ad valorem form, should any apply. If you need to give these rates as a fixed sum, use the Quantity Based AED and SED screen.

Additional Excise Rate

On this screen, maintain any cess applicable.

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 customer–material combination, you can maintain it here as well.

Sales Tax Setoff Percentages

On this screen, maintain the percentage of local sales tax on inputs that you can deduct against LST on outputs. The setoff amount is deducted from the inventory valuation of the material. Currently very few states, for example, Maharashtra and Gujarat, participate in this scheme.

Vendor Master (Excise Data)

Definition

The part of the vendor master record that contains information relating to excise duty.

Use



Structure

The excise part of the vendor master is divided into the following screens:

Vendor Excise Details

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

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

� Central sales tax (CST) number

� Local sales tax (LST) registration number

� 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:

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

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

� 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

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).

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).

Customer Master (Excise Data)

Definition

The part of the customer master record that contains information relating to Indian excise duty.

Use



Structure

The excise part of the customer master contains the following information:

Customer Excise Details

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

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




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

Excise Indicator for Plant and Customer

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Plant Master (Excise Data)

Definition

The part of the plant master record that contains information relating to Indian excise duty.

Use



Structure

The excise part of the plant master is divided into the following screens:

Excise Indicator for Plant

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




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).

Excise Indicator for Plant and Vendor


Excise Indicator for Plant and Customer


Excise Duty for Small-Scale Industries

Use

Businesses that qualify as small-scale industries (SSIs – those with, for example, no more than two premises and with a sales volume not exceeding an amount specified by the government) need to pay only reduced rates of excise duty on their goods movements. The exact rate depends on the business's annual sales volume (see

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below).

That means that when you make a purchase from an SSI, the system calculates a different rate of excise duty. Note that SSIs are not required to pay additional excise duty or special excise duty.

Prerequisites

In order for the system to be able to calculate the correct rate of excise duty, you must have:

1. Defined the SSI statuses.

You define a separate SSI status for each of the various "slabs" (sales volume) (see Vendor Master (Excise Data).

2. In the vendor master:

� Assigned the vendor the SSI status that you have just defined.

� If the vendor participates in the CENVAT scheme (see below), entered X (Vendor participating in CENVAT scheme).

Features

As far as SSIs are concerned, there are two schemes. Under the first, an SSI can opt out of the CENVAT scheme. In this case, they apply basic excise duty at certain flat rates on all transactions. These rates vary according to their total annual sales.

An SSI with sales of less than INR 100,000 would not apply any excise duty; those earning up to INR 400,000 would levy basic excise duty on all materials at 2%, and so on.

Under the second scheme, whereby an SSI participates in the CENVAT scheme, the SSI pays excise duty at a percentage of the normal basic excise duty for the material in question. Again, this percentage depends on the SSI's total annual sales.

Configuration of Tax Calculation Procedure TAXINJ

Purpose TAXINJ is a tax calculation procedure for country version India and it supports formula-based excise determination. You need to configure this tax calculation procedure.

Process Flow Execute the following steps in the Implementation Guide to configure the tax calculation procedure TAXINJ:

Procurement

Turnover (INR) Excise (%) SSI rate (% of excise) Effective SSI excise (%)

0–100,000 15 60 9

100,000–400,000 15 80 12

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� Excise Conditions

� JMOD IN: A/R BED

� JNED IN: A/R NCCD

� JAED IN: A/R AED

� JSED IN: A/R SED

� JCES IN: A/R Cess

� JECS A/R Educational CESS


� JIN1 IN: A/R CST

� JIN2 IN: AR LST

� JIN4 IN: A/R CST Surcharge

� JIN5 IN: AR LST Surcharge

� JIN6 A/R VAT Payable

� JIN7 A/R CST Payable VAT

○ Service Tax Conditions

� JSE4 Service Tax

� JES4 ECS on Service Tax



○ VS6 Input Tax

Define the Tax Procedure according to the settings in the figures below.


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→ Tax on Sales/Purchases → Basic Settings → Check Calculation Procedure → Define Procedures.

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Assign Tax Procedure to the country.


→ Tax on Sales/Purchases → Basic Settings → Assign Country to Calculation Procedure.

Sales


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Financial Accounting Global Settings → Tax on Sales/Purchases → Basic Settings → Check Calculation Procedure:

○ Excise Conditions

� JMOD IN A/R BED

� JEX2 IN A/R BED

� JAED IN A/R AED

� JEXA IN A/R AED

� JNED A/R NCC duty

� JEXN A/R NCCD

� JSED IN A/R SED

� JEXS IN A/R SED

� JCES IN A/R CESS

� JCED IN A/R CESS

� JECS IN A/R EDU-CESS

� JECX IN A/R EDU-CESS

� LST/CST/VAT Conditions

■ JIN1 IN A/R CST

■ JIN2 IN A/R LST

■ JIN4 IN A/R Surcharge

■ JIN5 IN A/R LST Surcharge

■ JIN7 IN A/R CST in VAT

■ JIN8 IN A/R LST – Value

� Service Tax Conditions

■ JSE4 IN Service Tax

■ JES4 ECS on Service Tax

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Set up the Condition Type UTXJ and assign the Access Sequence as JIND.


→ Tax on Sales/Purchases → Basic Settings → Check Calculation Procedure → Define Condition Types.



○ MW3 Sales tax 3

○ MWS Output tax

○ JN6 A/R VAT Payable

○ JN7 A/R CST Payable VAT

○ JN9 LST Value

○ JS6 A/R Service tax

○ JS7 A/R ECS on Service

Set up the following Pricing Procedures according to the settings in the figures below.

You can do this in the IMG under Sales and Distribution → Basic Functions → Pricing → Pricing

Control → Define And Assign Pricing Procedures.

○ JDEPOT (IN:Depot sale with formula)

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○ JEXPOR (IN:Export sales with formula)

○ JFACT (IN:Factory sale with formula)

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○ JSTKTR (IN:Stock transfer with formula)

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External Procurement (Domestic)

Purpose This process illustrates how manufacturing plants can use the SAP system to procure excisable goods.

In addition to the standard procedure, you also have to capture and post the incoming excise invoice, and the system creates the appropriate entries in the excise registers.

Process Flow

You create a purchase order for the goods you want and send it to the vendor.

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After a few days, the vendor sends you the goods together with an excise invoice.

When the goods arrive at your company, the warehouseman enters the goods receipt.

The system:

� Creates a material document to record the goods receipt

� Creates an accounting document to debit the inventory account and credit the GR/IR clearing account:

� Creates a Part I entry in register RG 23A or 23C

Note that if you first want to post the goods to blocked stock, for any reason, do so using the standard procedure. The excise clerk then captures the excise invoice as normal.

The excise clerk captures the excise invoice.

For information about what to do if the vendor sends the goods in more than one delivery, see Multiple Goods Receipts for a Single Excise Invoice.

The excise supervisor checks the excise invoice captured by the clerk, makes any changes necessary, and posts it.

The system automatically debits the excise duty to the excise duty accounts and credits the CENVAT clearing account:

It then creates a Part II entry in register RG 23A or 23C to record this posting.

You enter the vendor's invoice, following the standard procedure.

If the excise supervisor has reduced the amount of excise duty that is to be credited to the CENVAT account, the system adds the difference to the material price.

The system also creates an accounting document. The document contains debit postings to clear the clearing accounts for goods receipts and CENVAT; and a credit posting to create an open item on the vendor's account:

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Alternatives

The above procedure is just one way of using the SAP system to handle incoming excise invoices. If your business processes differ from the procedure described above, there are a number of alternatives available to you.

One-Step Procedure

In the procedure described above, the excise clerk captures the excise invoice and the excise supervisor posts it (the two-step procedure). If you want, you can have one person perform both of these activities in a single step,

using the transaction under Indirect Taxes → Procurement → Excise Invoice → Incoming Excise Invoice →

Central Processing → Capture/Change/Cancel/Display/Post.

Capture Excise Invoice and Goods Receipt Combined

Steps 2–3 involve two different system transactions (goods receipt and excise invoice capture). You can combine these two steps one, if you wish, so that the warehouseman can capture the excise invoice at the same time as he enters the goods receipt (see Goods Receipts and Incoming Excise Invoices Combined).

If you want, he can even capture and post the excise invoice at the same time.

Capture Excise Invoice Before Goods Receipt

In the procedure described above, the goods receipt is entered before the excise invoice. However, your business processes may require you to capture the excise invoice before the goods receipt.

When the warehouseman enters the goods receipt, the system adjusts the material value for any changes to the taxes that the clerk has made in the captured excise invoice. An accounting document to debit the inventory account and credit the GR/IR clearing account is created.

Creating Purchase Orders

To create a purchase order, follow the standard procedure, but when you fill out the item information, enter the following data on the Invoice tab:

� Enter a tax code.

If you do not, the system will not calculate excise duty or display it on the excise invoice create screen.

If you use condition-based excise determination, make sure you enter the tax code that you have defined for this purrpose.

If you are only eligible for partial CENVAT credit, you must use an appropriate tax code. If the CENVAT credit is less than the duty amount entered, the system will automatically add the difference to the inventory value when you come to verify the invoice.

� Select GR-based IV, to activate goods receipt-based invoice verification. During invoice verification this will

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enable the system to update the material value to allow for any discrepancies between the taxes in the purchase order and the taxes stated by the vendor in the excise invoice.

The purchase order shows the excise duty and sales tax that you expect to pay. The taxes are calculated in the purchase order according to the vendor, material, and tax code.

See also:

Condition-Based Excise Determination

Entering Goods Receipts

Use

In this procedure, you enter the goods receipts, following the standard procedure. In addition:

� You enter the number of the excise invoice, if it is available

� The system automatically creates an entry in Part I of the excise register RG 23A or RG 23C

This procedure only applies if the warehouseman is not entitled to enter excise invoices himself (see Goods Movements and Excise Documents Combined).

Prerequisites

You have specified whether you want the system to create a Part I entry when you post goods receipts to blocked stock, for stock transport orders, and to consumption stock. You do so in Customizing for Logistics – General, by

choosing Taxes on Goods Movements → India → Basic Settings → Maintain Excise Groups.

Procedure

1. From the SAP Easy Access screen, choose Logistics → Materials Management → Inventory

Management → Goods Movement → Goods Receipt → For Purchase Order → GR for Purchase Order.

2. In the top line, enter the purchase order number and choose .

A dialog box appears.

3. Enter data as required:

� If you have not yet captured the excise invoice:

� Leave the Excise Invoice field blank.

� Fill out all of the other fields.

� If you have already captured the incoming excise invoice, enter the excise invoice number.

4. To close the dialog box, choose .

If you choose , the system will not make an entry in Part I of the excise register, in which case you must

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update the register later.

5. Check that all the line items are correct, and adjust them as required. 6. Save the goods receipt.

Entering and Verifying Invoices

Follow the standard invoice verification procedure, but select Calculate tax on the Vendor Items screen. The system proposes the deductible excise duty items in the invoice document.

External Procurement (Imports)

Purpose

This process shows you how to handle the countervailing duty (CVD) on imports, which is levied in place of excise duty. Unlike other forms of customs duties, such as basic customs duty or special customs duty, you can credit CVD paid on imports to your CENVAT account.

Prerequisites

Vendor Master Record for Customs Office

Create a vendor master record for the customs office, so that you can create liabilities for the CVD (see step 3 in the process flow).

Condition Type for CVD

The system handles CVD using a condition type for planned delivery costs. Specify which condition type you use

in Customizing for Logistics – General, by choosing Taxes on Goods Movements → India → Basic Settings →

Determination of Excise Duty → Excise Defaults.

For more information, see Planned Delivery Costs.

CVD Clearing Account

When you post CVD to a CENVAT account (see step 5 below), the system debits the CVD to the BED account and credits it to a CVD clearing account.

Specify which G/L account you want to use as the CVD clearing account, in Customizing for Logistics – General,

by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Company Code Settings.

Process Flow

1. You create a purchase order for the goods that you want and sent it to the vendor.

For each material that you will have to pay CVD on when it comes through customs, you enter the CVD as a pricing condition.

2. The vendor ships the goods to you.

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When the goods arrive in India, they go through customs. The customs officers issue a bill of entry for the goods, which is in effect an invoice for the CVD on the goods. Once they have inspected the goods, they send them on to you.

3. The goods arrive at your plant, together with the bill of entry. In order to record the bill of entry in the system:

a. The excise clerk enters an invoice for the bill of entry

In Accounts Payable (FI-AP), the system creates a new vendor item for the CVD at the customs office. The item is offset to the CVD clearing account.

b. He then captures an excise invoice for the bill of entry

4. The warehouseman posts the goods receipt. 5. The excise supervisor posts the excise invoice.

6. The excise clerk enters the vendor invoice for the materials, following the standard procedure.

Creating Purchase Orders

Use

You follow this procedure to create a purchase order for imports.

Country Version India contains a sample pricing procedure for imports, JIMPOR.

Procedure

Create a purchase order for the materials that you want to order using the standard procedure, but when you fill out the item information, make sure that you observe the following:

� Invoice tab

� Enter a zero-rate tax code

� Deselect GR-based IV

� Conditions tab

a. Select the countervailing duty (CVD) condition and choose . b. In the Rate field, enter the rate of CVD that will be levied on the material when it arrives at customs. c. In the vendor field, enter the vendor master record that you have created for the customs office.

Then, once the vendor has delivered the goods and you enter the invoice, the system will automatically credit the CVD liability to the customs office.

Entering Invoices for Bills of Entry

To enter an invoice for a bill of entry, you follow the standard invoice verification procedure, but make sure you observe the following:

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Header Data

� Basic data tab

� In the Amount field, enter the amount of countervailing duty (CVD) stated on the bill of entry in rupees.

� Do not enter any other taxes.

� Details tab

� Assuming you specified in the purchase order that the CVD was to be paid to the customs office, the system shows the customs office as the vendor. If not, enter the customs office’s vendor master record in the Inv. party (Invoicing party) field.

Line Items

On the PO reference tab, enter data as follows:

1. Enter the number of the purchase order related to this delivery.

� If you only created one purchase order for the goods, enter the purchase order number and select Planned delivery costs.

� If you sent more than one purchase order to the vendor and it sent you all of the ordered materials together in one shipment:

i. Choose . ii. Enter all of the purchase order numbers in the table. iii. Select Planned delivery costs. iv. Select Deliveries and deselect Returns.

v. Choose Adopt.

In both cases, the system displays the line items in the line item overview.

2. For each line item:

� In the Amount field, enter the amount of CVD on the item (if you have more than one item, you may have to work the amount out manually).

� In the Quantity field, enter the quantity of goods on the invoice.

� Enter a zero-rated tax code.

3. Choose Simulate.

A dialog box appears with a list of the postings that will be made to Financial Accounting (FI).

4. Choose Post.

Capturing Excise Invoices for Bills of Entry

1. From the SAP Easy Access screen, choose Indirect Taxes → Procurement → Excise Invoice → Incoming

Excise Invoice → Individual Processing → Capture/Display. 2. In the top line:

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a. Select Capture Excise Invoice b. Select Purchase Order. c. Enter the purchase order related to the bill of entry.

d. Choose .


3. Enter the number of the invoice that you entered for the bill of entry and choose . 4. If you need to enter any other purchase orders, enter the number in the top line as for step 3.

Note that this time, you do not need to enter the invoice number.

5. Enter other data as required.

Note that the countervailing duty is displayed in the basic excise duty fields.

6. Save the excise invoice.

Entering Goods Receipts

Use

In this procedure, you record the receipt of the goods from the vendor abroad, following the standard procedure.

Procedure



2. In the top line, enter the purchase order number and choose .


3. Enter the number of the excise invoice that you created for the bill of entry and choose . 4. If you need to enter more purchase orders – for example, if you sent the vendor more than one purchase

order and it sent you back all the ordered materials in a single delivery – for each purchase order, enter the

number in the top line and choose . 5. Check that the line items in the goods receipt are correct. 6. Save the goods receipt.

Result

The system creates:

� A goods receipt document

� An accounting document

� An entry for the goods receipt in Part I of the appropriate excise register

Posting Excise Invoices

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Excise Invoice → Individual Processing → Change/Display/Post/Cancel. 2. Select Post CENVAT and Vendor Excise Invoice. 3. Enter the number of the excise invoice that you created for the bill of entry. 4. Check that the data is correct.

5. Choose Simulate CENVAT.

A dialog box appears with a list of the accounting entries that will be made to transfer the CVD from the clearing account to the excise duty account.

To close the dialog box, choose .

6. If the data is correct, choose Post CENVAT.

The system posts the CENVAT and creates a corresponding entry in Part II or the appropriate excise register.

Subcontracting

Use

If you work with subcontractors, there are two ways of handling the excise invoice on the goods that you provide them with:

� Subcontracting without payment of excise duty � Subcontracting under full payment of duty

Country Version India supports both of these approaches.

For information about the standard subcontracting procedure in the SAP System, see Subcontracting.

Subcontracting Without Payment of Excise Duty

Purpose

When you issue materials to a subcontractor, you need to keep track of what materials you have issued and when they have to be returned by.

The reason for this close monitoring has to do with India’s tax law. Under excise law 57AC, when you send materials to a subcontractor for processing, you are not required to pay any excise duty, even though the materials have left your premises. However, if the materials have not been returned to you within a given length of time specified by the law (in 2000, 180 days), you will have to reverse any excise credit that you posted when you purchased the materials (see Completion, Reversal, and Recredit). In the case of materials that you have manufactured in-house, you will have to post credit entries to the extent of the CENVAT rate of the assessable value of the materials.

Prerequisites

You have made the Customizing settings in Customizing for Logistics – General, by choosing Taxes on Goods

Movements → India → Business Transactions → Subcontracting.

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You have made the Customizing settings for the accounting postings in Customizing for Logistics – General, by

choosing Taxes on Goods Movements → India → Account Determination.

You have set up the number range for the subcontracting challan in Customizing for Logistics – General, by

choosing Taxes on Goods Movements → India → Tools → Number Ranges.

You have maintained the subcontracting information in the material masters (see Material Master (Excise Data)).

You have made the following settings in Customizing for Materials Management → Inventory Management and Physical Inventory:

� Goods Issue/Transfer Postings → Define Screen Layout.

For movement type 541, in the Change View Field Selection Overview, pick the 541 movement type and in the Select Group Materials Management, make the Purchase Order field an optional entry.

� Output Determination → Maintain Output Types

� Output Determination → Assign Forms and Programs

� Output Determination → Printer Determination → Printer Determination by Plant/Storage Location

Process Flow

1. You create a subcontract order for the goods that you want to subcontract. 2. You create a transfer posting order for the materials that are to be sent to the vendor. This document is,

however, for your own use only. 3. You create a subcontracting challan on the basis of the transfer posting order.

This is the consignment document that you will send to the subcontractor along with the materials that are to be processed.

4. You send the materials to the subcontractor, along with a printout of the subcontracting challan. 5. The subcontractor processes the materials and returns the finished goods. When the goods are delivered

back to you, the storeperson posts the goods receipt and the challan.

The delivery may not necessarily cover all the goods from the challan: It may also include goods from a number of different challans. The SAP functions allow for this eventuality.

6. The excise department reconciles the goods receipt against the challan, thereby accounting for the return of the materials that you have sent for subcontracting.

The challans here include those that have been captured online at the time of goods receipt and those entered manually.

7. You create a list of the outstanding challans. 8. You complete the challan.

If a subcontractor fails to return all the materials within the time allotted, you have to scrap the material by specifying it as such in the bill of material for the parent material then assigning the bill of material to the subcontracting purchase order. If the scrap generated is not returned by the subcontractor, excise duty relevant to the scrap generated has to be paid. If this scrap is returned after the duty has been paid, an excise journal voucher should be created to reverse the excise duty paid.

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Alternatives

The procedure given in step 5 shows how to enter the goods receipt using the old Goods Movement transaction. If you want to use the new Goods Movement transaction, MIGO, see Entering Goods Receipts and Subcontracting Challans Together.

Subcontracting Challan

Definition

A document that you use to issue and track subcontracting work. It allows you to make sure that all the materials you have sent to the subcontractor for processing are returned.

The challan is also widely known as the 57F4 challan, after the law under which it was defined up until the 2000 budget. This law has now been superceded by a new one, 57AC.

Use

You create challans from transfer orders to accompany any materials that you send to subcontractors under rule 57AC. In this respect, they are an extended form of delivery note, with additional information about the excise duty on each material that you have supplied. Materials that are not liable to excise duty do not have to be included in the challan.

As the subcontractors return the finished goods to you, you record the returns in the challan, to make sure that all are returned within the allotted time limit.

If the finished goods returned to you by the subcontractor are of substandard quality, you can also create a subcontracting challan from the returns order.

Structure

The challan consists of a header and line items. The header, in addition to organizational data, allows you to enter:

� Preprinted number

� Additional data

� Identification marks

� Nature of processing

Furthermore, each challan has two numbers, an internal document number and a challan number, which the system assigns to the challan when you save it. From a business perspective, this is the most important number. Each challan also has a status, which shows you what stage in processing it is at.

The line items are copied across from the transfer posting when you create the challan. You can also enter additional data for each item.

Processing Subcontracting Challans

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To access the individual functions shown in the table, from the SAP Easy Access screen, choose Indirect

Taxes → Procurement → Subcontracting → Subcontracting Challans → …

Creating Subcontracting Challans

1. From the SAP Easy Access screen, choose from the SAP Easy Access screen, choose Indirect Taxes →

Procurement → Subcontracting → Subcontracting Challans → Create. 2. Enter the following data:

� Material Document: The transfer posting document number

� Material Document Year: The year that you created the transfer posting document

� Excise Group

� Series Group

3. Choose .

The system calculates the excise duty for the materials.

Function Follow-on menu path What you should know

Create a challan → Create. See Creating Subcontracting Challans

Print a challan → Create or

→ Change. See Printing Subcontracting Challans.

Change a challan → Change. You can only change challans with the status Posted.

Furthermore, you can only change data that relates to the challan printout. If you need to change accounting data, you must delete the challan and create a new one.

Cancel a challan → Change → . To save the cancellation, save the challan.

The challan status changes to Canceled.

Complete a challan →

Complete/Reverse/Recredit See Completing Subcontracting Challans.

The challan status changes to Completed.

Reverse the excise duty credit

→

Complete/Reverse/Recredit See Reversing Excise Duty Credit.

The challan status changes to Reversed.

Recredit the excise duty

→

Complete/Reverse/Recredit See Recrediting the CENVAT Account.

The challan status changes to Reversed/completed.

Reconcile quantities → Reconcile Quantity See Reconciling Quantities.

The challan status changes to Assigned/fully reconciled.

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4. Specify which excise invoice the materials are from.

Once you have assigned the materials to an invoice, the system reads how much excise duty you have paid on the materials that you are sending.

5. If you want to print the challan straight away, select Print immediately on the Posting tab. 6. Change the posting date, if necessary.

This is the date from which the system calculates the return due date. It is set by default to the day’s date. However, you can change it you need to.

7. Save the document.

Calculation of Excise Duty on Materials for Subcontractors

Use When you send materials to a subcontractor for processing, you have to determine how much excise duty is applicable. This of course depends on the base value. The different amounts of excise duty (basic excise duty, special excise duty, and additional excise duty) are printed on the subcontracting challan.

Thus, when you create a subcontracting challan, the system determines the base excise value of each material and the amount of excise due automatically.

Prerequisites You have maintained the materials’ excise data (see Material Master (Excise Data)).

Features When determining the excise duty for materials purchased from third parties, the system uses the excise rate from the latest excise invoice for the material received from the vendor.

Where materials manufactured in-house are concerned, the SAP System determines the taxable value of the material on the basis of the following information, in this order:

The latest excise invoice value for the material

The material's assessable value (that is, the price determined by an external auditor)

The material’s net dealer price (the material’s list price; the price at which you sell the material to customers)

Selecting Excise Invoices

1. Select the material that you want to assign the excise invoices to and choose Excise invoice selection. 2. Select the excise invoice or invoices.

3. Choose .

Printing Subcontracting Challans

You can print a subcontracting challan when you create it, or if you need to print it later on, in the change transaction.

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1. From the SAP Easy Access screen, choose Indirec Taxes → Procurement → Subcontracting →

Subcontracting Challans → Change. 2. On the Posting tab, select Print Immediately. 3. Enter the number of the preprinted stationery, if necessary.

This number will be saved for future reference.

4. Save the challan.

Reconciling Quantities

Use

Once a subcontractor has processed your materials and returned them to you, you match the items in the challan against those that have been returned.

Prerequisites

You have posted the goods receipt (or any other material document) for the returned goods.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Procurement → Subcontracting →

Subcontracting Challans → Reconcile Quantity. 2. Enter the following data:

� In the Material Doc. and Mat. Doc. Year fields, enter the number of the goods receipt document and the year in which it was created.

� In the table below, enter the challan numbers and the years in which they were created.

If the material document is a goods receipt document with movement type 101, you can enter the challans that were not captured when the goods receipt was posted. However, if all the relevant challans were entered during goods receipt, they need not be entered here

3. Choose Reconcile.

A new screen appears. At the top is the information about the goods receipt (or other document); at the bottom is the information from the challans that you have entered.

4. Specify which challans the materials in the goods receipt originated from:

� If you have sent a subcontractor a number of different challans, all containing the same material, you can automatically specify that the materials should come from the oldest challans first, by

choosing .

� Otherwise, for each challan, enter manually the quantity of materials has been returned, and choose

to refresh the display.

5. Once you have accounted for all the materials in the goods receipt, save the challan.

Result

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The system changes the challans' status as follows:

� If you have accounted for all of the materials in a challan, the system sets its status to Fully Reconciled. In this case, you can complete the challan.

� If you have accounted for only some of the materials, it sets the status to Assigned. In this case, you must

assign the remaining quantity of materials to another goods receipt later on.

� Scrap generated is assigned to a challan only if the percentage component scrap is specified in the bill of material for the parent material and this bill of material is assigned to the subcontracting purchase order.

Deleting Assignments

Use

You follow this procedure if you have assigned the wrong challan to a goods receipt or other material document (see Reconciling Quantities).

Prerequisites

You have:

� Assigned the challans to a goods receipts document

� Assigned the challans to a material document in quantity reconciliation

� Not completed or reversed the challans

Procedure


Subcontracting Challans → Reconcile Quantity → Delete Assignments. 2. Choose Delete Assignment.

Result

The assignments will be deleted. The challans will no longer be related to the material document until another assignment takes place between the same.

Completion, Reversal, and Recredit

Use

You use this function to close a challan completely after all the materials have been accounted for. If a challan's return date has elapsed, and thus your right to the CENVAT credit, you use it to reverse the excise credit – or, should your subcontractor return the goods subsequently, to recredit the excise credit.

To access the function, from the SAP Easy Access screen, choose Indirect Taxes → Procurement →

Subcontracting → Subcontracting Challans → Complete/Reverse/Recredit.

Features

Exactly which function is available depends on the challan's status as follows:

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Completion

You can complete a challan if you have accounted for all of the materials in it (and it thus has the status Fully Reconciled). This prevents you from making any more changes to it.

Reversal of CENVAT Credit

If the allotted number of days elapses and the subcontractor has not returned some or any of the materials in the challan (status: Posted or Assigned), you must reverse the excise duty that you have credited to your CENVAT account. The scrap has to be returned by the subcontractor. If it is not returned, the excise duty for the scrap has to be reversed.

This function sets the status to Reversed. From here, you have two options:

� If you do note expect the subcontractor to return the materials, you can complete it. � If you do expect the subcontractor to return at least some of the materials, you can leave it as it is for the

time being. Then, when the materials arrive, you can recredit the excise duty to the account (see below).

Recredit

If a subcontractor returns materials after the return date, you can recredit the excise duty credit that you have reversed.

Completing Subcontracting Challans


Subcontracting Challans → Complete/Reverse/Recredit. 2. Enter the challan number and year.

3. Choose . 4. Select Complete Challan. 5. Save the challan.

Reversing Excise Duty Credit



3. Choose . 4. Select Reverse Challan. 5. Save the challan.

Recrediting the CENVAT Account



3. Choose . 4. Select either of the following options:

� Take Recredit for Receipts

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This leaves the challan open for further goods receipts.

� Take Recredit If Any and Complete Challan

This completes the challan and writes off finally any CENVAT credit that you might have been able to claim.

5. Save the challan.

Making Transfer Postings

Use

You follow this procedure to create transfer postings, with or without reference to a purchase order.

Prerequisites

You have made the appropriate settings in Customizing for Materials Management, by choosing Inventory

Management and Physical Inventory → Goods Issue/Transfer Postings → Define Screen Layout.

In the Change View Field Selection Overview, select movement type 541 and mark the Purchase order field as an optional entry.

Procedure

Follow the standard procedure (see the section Providing Components from Inventory Management). Note that the movement type supplied with the standard system for transfer postings to stock for subcontractors is 541.

Posting Goods Receipts from Subcontractors

Use

When you post a goods receipt for a purchase order, you follow the standard procedure, but there are a couple of extra dialog boxes in which you can enter the challan data, if any is available. If the delivery note does not show the challan numbers, you can ignore the prompts to enter them.

Procedure

1. On the initial selection screen, enter data as follows:

� Movement type

In the standard system, enter 101 for goods receipts for purchase orders into warehouse.

� Purchase order

� Plant

� Storage location

2. Choose Adopt + details.

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A dialog box appears, which is not relevant for subcontracting.

3. Choose .

Another dialog box appears.

4. Enter the challans from which the materials were supplied, if available.

5. Choose . 6. Enter the challan numbers and the years that they were created.

7. Choose . 8. Save the goods receipt.

List of Subcontracting Challans

Use

You use this report to create a list of subcontracting challans. Depending on what selection criteria you enter, you can use it for finding out:

� Which challans are still with the subcontractor and are due back the following week

� Which challans you can make a recredit for

� Which challans have been entered for a goods receipt, but not reconciled

� Which challans' reference documents have been canceled

� Annexure IV

Features

To access the report, from the SAP Easy Access screen, choose, choose Indirect Taxes → Procurement →

Subcontracting → Reports → Challan Listing.

Output

The system displays a list of the subcontracting challans that meet your selection criteria. For more information about a particular challan, click it.

Subcontracting Under Full Payment of Duty

Purpose This procedure illustrates how you use the system to send materials to your subcontractors for processing using normal excise invoices.

Prerequisites You have created a condition type for manually entering excise duty in the subcontract order. In the standard system, you can use condition type JEXC.

Process Flow

The purchasing clerk creates a subcontract order for the subcontractor’s services.

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The warehouseman creates a transfer posting for the materials that you want to send to the subcontractor.

The excise clerk creates an outgoing excise invoice for the materials.

You send the materials to the subcontractor, together with the excise invoice.

The subcontractor processes the materials and returns them to you, together with another excise invoice.

The excise clerk captures the subcontractor’s excise invoice, using the purchase order as the reference document.

The warehouseman enters the goods receipt.

The excise supervisor posts excise invoice.

The accounts payable clerk posts the subcontractor’s invoice.

Creating Subcontract Orders

1. From the SAP Easy Access screen, choose Logistics → Materials Management → Purchasing →

Purchase Order → Create → Vendor/Supplying Plant Known. 2. Set the order type to Standard PO. 3. In the Vendor field, enter the subcontractor. 4. Fill out the Org. data (Organizational data) tab.

5. In the item overview, enter the line items as described in the standard procedure. 6. In the item details, on the Invoice tab:

� Select GR-based IV (Goods receipt-based invoice verification)

� Enter a zero-rate tax code

7. On the Conditions tab, enter the excise duty on the line item in the Condition value field for the manual excise value condition (in the standard system, condition type JEXC).

8. Save the subcontract order.

Creating Excise Invoices for Subcontractors

Use

To create an outgoing excise invoice for the subcontracting materials, follow the standard procedure.

On the selection screen, in the Reference group box, enter the number of the transfer posting document as the reference document. The reference document type is MATD (Material document).

Stock Transfer

Purpose

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This process shows you how to order goods from another plant in your company, taking into account all of the

excise regulations. For information about the standard procedure, see Two-Step Procedure – Plant.

Prerequisites

Before you can start, set up customer and master records for both plants as follows:

1. Create a customer master record for the issuing plant. 2. Create a vendor master record for the issuing plant, and enter customer account number in the Customer

field on the Control screen. 3. Repeat steps 1 and 2 for the receiving plant. 4. Assign the plants to the customer master record in Customizing for Materials Management (MM), by

choosing Purchasing → Purchase Order → Set Up Stock Transport Order → Plants.

Process Flow

1. You create a stock transport order, following the standard procedure, and send the order to the issuing plant.

2. The issuing plant has processes your order, and when it is ready to ship:

a. The storeperson at the issuing plant issues the goods using a transfer posting. b. The excise clerk there creates an excise invoice c. The excise supervisor verifies and posts the excise invoice.

It then sends the goods to you, together with the excise invoice.

3. Once the goods arrive, you follow the standard procedure for incoming excise invoices:

a. The excise clerk captures the excise invoice, using the stock transport order as the reference document.

b. The storeperson enters the goods receipt, again using the stock transport order as the reference document.

Alternatively, you can first enter the goods receipt and then capture the excise invoice.

4. The excise supervisor then posts the excise invoice.

Incoming Excise Invoices

Use

This transaction is mainly for use by excise clerks, so that they can capture incoming excise invoices, and excise supervisors, who then post the excise invoices captured by the clerks.

To access the function, from the SAP Easy Access screen, choose Indirect Taxes → Procurement → Excise

Invoice → Incoming Excise Invoices → Individual Processing → Capture/Display for excise clerks or Change/Display/Post/Cancel for excise supervisors.

Prerequisites

You have made the appropriate settings in Customizing for Logistics – General, by choosing Taxes on Goods

Movements → India → Business Transactions → Incoming Excise Invoices.

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Integration

The function is an integral part of the procurement process in Country Version India and contains information relating to material movements and taxes. As such it is integrated with Materials Management (MM) and Financial Accounting (FI).

Any entries that the system makes in relation to an incoming excise invoice, in Parts I and II of the excise registers RG 23A and 23C, are also shown in the transaction.

Features

The screen consists of the following areas:

Top Line

This is where you specify what document you want to process. When you capture an incoming excise invoice, you specify the reference document in this area. When you process an excise invoice that you have already captured, you enter the excise invoice number.

Header Data

This area consists of four tabs, each with information that relates to the whole of the excise document.

Tab Use

Excise Invoice Basic header data that you would expect to find at the top of the excise invoice itself, such as the excise invoice number and the date.

Totals Total amounts of different types of excise duty in the excise invoices.

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Item Overview

This area lists all of the items in the excise invoice. To process an item, you click the item number and process it in the detail data , but you process the items in the detail data area.

Detail Data

This area consists of seven tabs, each with information about a particular item.

Reference Documents

Use

When you capture an incoming excise invoice, the first piece of information that you enter is the reference document, in the top line.

Immediately you enter the reference document, the system copies all the appropriate header data and line items from it into the excise invoice, so that there is less typing for you to do and less likelihood of making errors.

Miscellaneous Information about the manufacturer of the goods, if different from the vendor that sent you the goods, and about the manufacturer’s excise registration details.

You can also enter a serial number, if the excise invoice was printed on preprinted stationery, or a rejection code, if you need to reject the invoice.

Additional Data Fields for any additional information that you might want to enter, according to your own requirements.

Part II Any entries in Part II of the excise registers RG 23A or RG 23C.

Note that this tab is not displayed if there are no Part II entries.

Tab Use

Item Basic information about the material itself.

Quantities Information the quantity of goods in the excise invoice, and how much of this quantity have entries in Parts I and II of the excise registers.

Duty Rates The rates of excise duty on the item.

Duty Values The excise duty on the item, and how much of it has already been credited to the CENVAT accounts.

Reference Documents

The other SAP documents associated with the item.

Additional Data Fields for any additional information that you might want to enter, this time at item level.

Part I, Part II Any entries in Part I or Part II of the excise registers RG 23A or RG 23C.

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By specifying the reference document, you also ensure that the excise invoice is properly integrated into the SAP document flow.

Features

There are two scenarios where you might be sent an excise invoice:

� External procurement, where a vendor sends you some goods accompanied by an excise invoice

� Stock transport orders, where another of your business’s plants sends goods to your plant, again, accompanied by an excise invoice

Use in External Procurement

In the external procurement process, there are several types of documents that you can use as a reference documents. You specify the document type in the top line.

If you have already posted a goods receipt for the deliver, use the goods receipt as the reference document in preference to any other documents related to the delivery.

If the goods were delivered as the result of a purchase order, contract, or scheduling agreement but you have not yet posted the goods receipt, use one of these documents.

When you use one of these documents, the system cross-checks all the data you enter in the excise invoice against the master data and transaction data already at its disposal.

Fewer Cross-Checks

Alternatively, if you have a material document but for whatever reason you want fewer cross-checks, select Without Purchase Order and enter the material document number.

The system still copies the data from the material document, but the cross-checks are less stringent.

No Reference Documents Available

If for any reason a vendor sends you a delivery and excise invoice for which you do not have any reference documents, you can still capture the excise invoice, but you have to do it manually, so select Without Purchase Order. Again, there are few cross-checks that the system can carry out.

For more information, see Capturing Excise Invoices Without Reference Documents.

Use in Stock Transport Orders

If your plant has created a stock transport order for materials to be sent from another plant, you select Stock Transport Order.

Capturing Excise Invoices Using Reference Documents

Use

You use this procedure to capture incoming excise invoices using a reference document.

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Procedure


Excise Invoices → Individual Processing → Capture/Display.

2. Specify the reference documents.

3. Edit the excise invoice header data. 4. Remove any items from the item overview that you do not need. 5. Edit the items. 6. Save the excise invoice.

If at any time you want to start over, choose .

Result

The system:

� Creates the excise invoice and assigns it an internal excise invoice number � Sets the document status (on the Excise invoice tab) to In process

The excise supervisor then has to post the excise invoice in a separate step.

Specifying Reference Documents

1. In the top left-hand corner of the screen, in the top line, select Capture Excise Invoice. 2. In the next field, select the reference document type (for example, Goods Receipt or Purchase Order). 3. In the next field, enter the number of the reference document.

If you only want one of the line items from the reference document, enter the line item number in the following field. Otherwise, leave the field blank.

4. Choose .

The system copies the relevant header data and items from the reference document into the screen.

5. If you need to specify another reference document – for example, if you sent the vendor two separate purchase orders and it sent the ordered materials in one delivery with one excise invoice – repeat steps 1–4.

This only applies to purchase orders, scheduling agreements, and contracts.

The system copies the additional line items into the screen.

Editing Header Data

Use

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Once you have specified the reference documents, the next step in capturing the excise invoice is to edit the excise invoice header data on the screen to match what is printed on the excise invoice itself.

Much of the header data is copied automatically from the reference documents, but some information you will have to maintain manually.

Procedure

1. On the Excise invoice tab, enter the excise invoice number and date from the vendor’s excise invoice. 2. If the materials were supplied by a different vendor than the one in the purchase order, enter the vendor in

the Ship-from field on the Miscellaneous tab and choose .

The system changes the excise range, division, and ECC number accordingly.

This information shows who paid the excise duty on the materials. If your vendor has not manufactured the materials itself, but has purchased them from another business, it will be the latter who has paid the excise duty, not the vendor.

3. Choose Check to check the header data.

� If the data is in incomplete or incorrect, the system displays a list of the problems.

� If the data is all right, the traffic light on the Excise invoice tab turns green.

Removing Items from the Item Overview

Use

When you specify the reference documents, the system automatically enters all the line items from the documents. However, there may be fewer items in the excise invoice than in the reference document. In that case, you have to remove the excess items from the overview.

Procedure

1. In the item overview, mark the line items that are in the excise invoice as OK.

2. Choose Delete.

The system removes all of the items that are not marked as OK.

Editing Line Items

Use

Once you have specified the reference documents and have edited the line item overview, edit each line item to make sure that the information on the screen matches the information in the vendor’s excise invoice.

Procedure

1. In the item overview, click the number of the item that you want to edit.

The system displays the item in the detail data and grays it out in the overview so that you cannot edit it

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there.

2. In the detail data, check the quantities, duty rates, and duty values against the vendor’s excise invoice and adjust the information in the system to match it if necessary.

3. Select Item OK.

When you save the excise invoice, the system only saves the items that you have marked as OK.

4. To check the item data to make sure that the system accepts it, choose Check.


� If the data is all right, the item’s traffic light in the item overview turns green.

Capturing Excise Invoices Without Reference Documents

Use

This procedure shows you how to capture an incoming excise invoice if you do not have any reference documents.

You can also follow this procedure if you do have a material document that you want to use as a reference document, but you want the system to cross-check the excise invoice data against other master data or transaction data less stringently than it normally would (for more information, see Reference Documents).

You commission a construction company build a new plant for you. The company purchases all the materials it needs to build the plant, deals with all of the invoices and most of the other paperwork, with the exception of the incoming excise invoices, which the law requires you to deal with yourself. The subcontractor sends you all excise invoices accordingly and you capture them in the system without any reference documents.

Procedure

1. From the SAP Easy Access screen, choose SAP Easy Access screen, choose Indirect Taxes →

Procurement → Excise Invoice → Incoming Excise Invoices → Individual Processing → Capture/Display. 2. In the top line:

a. Select Capture Excise Invoice. b. Select Without Purchase Order.

c. If you have a material document, enter the material document number and choose . If you do not have any reference documents, leave the field blank.

3. Enter the header data. 4. Enter the line items. 5. Save the excise invoice.

Result

Once you have saved the excise invoice, you treat it as you would any other excise invoice.

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Entering Header Data

1. On the Excise invoice tab:

� Copy the information from the vendor’s excise invoice into the following fields:

� Excise invoice number

� Excise invoice date

� Vendor

� Fill out the Excise group field.

2. On the Miscellaneous tab, enter the following data:

� If the vendor who sent you the excise did not manufacture the goods itself, but obtained them from a different manufacturer, enter the manufacturer in the Ship-from field and choose Enter.

� Change the excise range, excise division, and ECC number if they are incorrect.

3. Choose Check to check the header data.


� If the data is all right, the traffic light on the Excise invoice tab turns green.

Entering Line Items

1. On the Item tab, enter the following data:

� Material

� Plant

2. Choose .

The system:

� Adds the line item to the item overview

� Fills out the Material type, Description, and Chapter ID fields using the information from the material master record

If you have not maintained a material master record for this material, no information will be displayed, but you can enter it here manually.

3. On the Quantities tab:

� Enter the item quantity and change the unit of measure, if necessary

� Enter the quantity of goods still available for CENVAT credit

4. On the Duty values tab, enter the following data:

� Excise base amount

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� Excise amounts

5. To check the item data to make sure that the system accepts it, choose Check.


� If the data is all right, the item’s traffic light in the item overview turns green.

6. To add a new item, choose and repeat steps 1–5.

Posting Excise Invoices

Use

Once the excise clerk has captured the excise invoice, the excise supervisor checks it to make sure that the data has been entered correctly, and then posts the excise invoice.

If, however, there is a problem with the excise invoice and you need to reject it, see Rejection of Excise Invoices.

Procedure


Excise Invoices → Individual Processing → Change/Display/Post/Cancel. 2. In the top line:

a. Select Post CENVAT. b. Select Vendor Excise Invoice. c. Enter the excise invoice number.

3. Choose . 4. Check the information in the system against the vendor’s excise invoice and adjust the information in the

system to match.

You must pay particular attention to the excise duty that is to be credited to the CENVAT accounts.

5. To check the CENVAT postings, choose Simulate CENVAT.

A dialog box appears with a list of the postings that will be made. The excise duty accounts will be debited, and the CENVAT clearing account credited.


6. To post the excise invoice and make the CENVAT postings, choose Post CENVAT.

You can also save your changes without making any CENVAT postings by choosing .

Result

The system:

� Creates an accounting document to make the appropriate CENVAT postings

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� Creates the corresponding entries in Part II of the appropriate excise register

Long Texts

Use

When you capture an excise invoice, you can enter notes relating to the excise invoice – for your own reference only – as long texts.

Activities

Customizing

You define what sorts of long texts that you want to be able to enter in Customizing for Logistics – General, by

choosing Tax on Goods Movements → India → Tools → Long Texts.

You could define one long text for information about the bill of lading, and one for information about the Part II entry.


When you capture an excise invoice and you want to enter a long text for it, on the Additional Data tab, choose

Long Text.

In the dialog box, double-click the sort of long text that you want to enter, and type the text in the field next to it.

Rejection of Excise Invoices

Use

If a vendor sends you an excise invoice that as it stands is unacceptable – for example, if it is illegible or some of the data is missing – you still post the excise invoice, but you assign it a rejection code.

Features

If you only capture an excise invoice, the rejection code does not have any effect on the excise invoice other than to denote it as rejected in some way.

However, if you post an excise invoice, the rejection code controls whether the system creates a normal CENVAT document or if it posts the excise duty to the CENVAT on hold account pending clarification of the invoice.

Activities

Customizing

Define the rejection codes in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

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India → Business Transactions → Incoming Excise Invoices → Maintain Rejection Codes.


To reject an excise invoice, set the appropriate rejection code.

If you want, the system puts the excise duty on hold. Then, once you have checked the excise invoice, you can post the excise duty from the CENVAT on hold account to the excise duty accounts.

Rejecting Excise Invoices

Use

Follow this procedure to reject an excise invoice, if you still want to post the excise duty to the normal accounts.

Procedure



a. Select Post CENVAT. b. Select Excise Invoice Number. c. Enter the excise invoice number.

3. Choose . 4. On the Miscellaneous tab, enter a rejection code that posts the excise duty to the normal accounts.


A dialog box appears, showing you that the system will debit the excise duty to the excise duty accounts and credit it to the CENVAT clearing account.


6. Choose Post CENVAT.

Result

The system posts the excise invoice as normal. It:

� Posts the excise duty to the appropriate accounts

� Creates the appropriate entries in Part II of register RG 23A or RG 23C

� Changes the document status (on the Excise invoice tab) to Posted

Rejecting Excise Invoices with CENVAT on Hold

Use

Follow this procedure to reject an excise invoice and post the excise duty to a CENVAT on hold account, pending the receipt of more information.

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Procedure




3. Choose . 4. On the Miscellaneous tab, enter a rejection code that posts the excise duty to a CENVAT on hold account.


A dialog box appears, showing you that the system will debit the excise duty to the CENVAT on hold account and credit it to the CENVAT clearing account.



Result

The system creates an accounting document to posts the excise to the appropriate accounts, but does not create any entries in Part II of registers RG 23A or RG 23C.

If you display the excise invoice, you see:

� On the Excise invoice tab, the document status is In process

� On the Miscellaneous tab, there is a link to the accounting document

Once the vendor has provided you with the information you need, you can post the CENVAT on the rejected excise invoice.

Rejection Accounting Document

Definition

An accounting document that the system creates when you reject an excise invoice with CENVAT on hold.

Use


When you reject an excise invoice with CENVAT on hold, the system creates an accounting document to debit the excise duty to the CENVAT on hold account and credit it to the CENVAT clearing account:

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Posting CENVAT on Rejected Excise Invoices

Use

Follow this procedure if you have an excise invoice that you have rejected, with the CENVAT credit on hold, and you now want to take the CENVAT credit.

Procedure




3. Choose . 4. On the Miscellaneous tab, delete the rejection code.


A dialog box appears, showing you what CENVAT postings will be made.

The system will credit the CENVAT on hold account, and debit the appropriate excise duty accounts.



Result

The system:

� Posts the CENVAT credit as normal

� Creates the corresponding entries in Part II of the appropriate excise registers.

Reversal Rejection Accounting Document

Definition

An accounting document that the system creates when you post the CENVAT on a rejected excise invoice, to reverse the posting to the CENVAT on hold account.

Use


When you post the CENVAT, the system creates an accounting document to debit the excise duty to the excise duty accounts and credit it to the CENVAT on hold account:

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Reversal of CENVAT Postings

Purpose

Assume you have posted a goods receipt and then posted the CENVAT on the excise invoice accordingly. Then it transpires there is a problem with the goods and the goods receipt has to be reversed. Under excise laws, that means you are no longer entitled to the CENVAT credit.

In the SAP System, therefore, you have to reverse CENVAT posting correspondingly.

Process Flow

1. You reverse the goods receipt.

The system:

� Creates a reversal document to cancel the goods receipt

� Creates additional entries in Part I of the appropriate excise register to reverse the original entries

� Changes the excise invoice document status to In process.

2. You reverse the CENVAT posting on the excise invoice.

The system:

� Creates an accounting document to reverse the CENVAT postings

� Creates a corresponding entry in Part II of the appropriate excise register

3. If your plant does not allow multiple goods receipts per excise invoice, you must also cancel the excise invoice.

The system changes the excise invoice status to Canceled.

If, however, you do allow multiple goods receipts per excise invoice, you do not have to cancel it. If you want, you can leave the excise invoice as it stands. Then, if you receive another delivery of goods for this excise invoice, enter the excise invoice number when you post the goods receipt.

Reversing Goods Receipts


Management → Goods Movement → Goods Movement (MIGO). 2. In the top line:

a. Select Cancellation. b. Select Material document.

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c. Enter the number of the goods receipt that you want to cancel

d. Choose .

3. Flag all of the line items as OK. 4. Save the reversal document.

Reversing CENVAT Postings



a. Select Post CENVAT. b. Select Vendor Excise Invoice. c. Enter the excise invoice number.

d. Choose .


A dialog box appears, showing which postings the system will make to reverse the CENVAT.



Canceling Excise Invoices



a. Select Cancel. b. Select Vendor Excise Invoice. c. Enter the excise invoice number.

d. Choose . 3. Save the excise invoice.

Goods Movements and Excise Documents Combined

Use

If your business processes require, your warehousemen can process the necessary excise documents (for example, excise invoices or subcontracting challans) at the same time as they enter a goods movement, using the standard Goods Movement transaction, MIGO.

Features

Users in manufacturing plants can use the transaction when they receive goods from external procurement, goods transferred from another plant, or goods manufactured by subcontractors. They can also use the transaction when they issue goods to be transferred to another manufacturing plant or depot, or when they send scrap to a vendor.

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Users in depots can use the transaction when they receive goods procured externally or transferred from a manufacturing plant. They can also enter goods issues for sending scrap to a vendor.

In all the above scenarios, the transaction supports the one-step and two-step procedures.

Activities

Customizing

You activate this function for each excise group separately, in Customizing for Logistics – General, by choosing

Tax on Goods Movements → India → Basic Settings → Excise Groups.


When you run the Goods Movement transaction, the system displays an additional tab at header level for the excise invoice header information, and one tab at item level for the excise invoice line item information. You then fill out the data as required.

When you save the goods receipt or goods issue, the system also saves the excise invoice (either captured/created or posted). It creates all appropriate excise register entries, material documents, and accounting documents.

Note that once you have entered an incoming or outgoing excise invoice using the standard Goods Movement transaction, you can only process it further using the other excise invoice transactions.

One-Step and Two-Step Procedures

Use

You can customize the system so that the warehousemen can post the necessary excise documents duty (the one-step procedure) or whether you want excise supervisors to do this (the two-step procedure).

Features

This function works slightly differently for manufacturing plants and depots.

Manufacturing Plants

When the warehouseman in a manufacturing plant enters a goods movement, he can only post an incoming or outgoing excise invoice if you have made the appropriate Customizing settings (see below). If you want to follow the two-step procedure, he can only capture incoming excise invoices and create outgoing excise invoices.

You can also customize the system so that the warehouseman can only post an excise invoice if he does not change any of the excise data proposed by the system.

Depots

If you follow the one-step procedure, the warehouseman can post incoming excise invoices for goods receipts.

The only form of goods issue that the standard Goods Movement transaction supports is scrap, for which you do not require an outgoing excise invoice. However, the warehouseman must assign the goods issue to the appropriate folio numbers from the goods receipt (RG 23D selection. You can decide whether he can capture the

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RG 23D selection or post it as well.

Again, you can customize the system so that he can only post the data if he does not change the data proposed by the system.

Activities

Customizing

You can customize different procedures for each excise group.

Make the settings in Customizing for Logistics – General, by choosing Tax on Goods Movements → India →

Basic Settings → Maintain Excise Groups.


When the warehouseman enters a goods movement, he can only capture (or create) and post the excise invoice if you have authorized it for his excise group.

The excise supervisor follows the standard procedures for posting incoming excise invoices and posting outgoing excise invoices that need to be posted.

Entering Goods Receipts and Excise Invoices Together

Use

This procedure describes how warehousemen at manufacturing plants enter the receipt of goods procured externally, together with the incoming excise invoice.

You follow the standard procedure, and in addition, you also enter the excise invoice details at header level and item level.

Procedure



2. In the top line, enter the purchase order number and choose . 3. Enter header data as required, following the standard procedure.

In addition, on the Excise Invoice tab:

a. Set the excise action to Capture Excise Invoice or Capture & Post Excise Invoice. b. Enter the official excise invoice number and the excise invoice date.

If you need to enter any more data, choose .

4. Enter line item data as required, again, following the standard procedure.

In addition, on the Excise Item tab, change the data so that it matches the vendor's excise invoice, if necessary.

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5. Save the goods receipt.

Result

If you set the excise action to Capture Excise Invoice, the system creates:

� A material document to record the goods receipt

� An accounting document to debit the inventory account and credit the GR/IR clearing account

� A Part I entry in register RG 23A or 23C

The next step is to post the excise invoice, for which you use the Incoming Excise Invoices transaction.

If you set the excise action to Capture & Post Excise Invoice, the system also creates:

� A Part II entry in register RG 23A or 23C

� A CENVAT accounting document

The next step is to post the vendor's invoice, when it arrives.

Entering Goods Receipts with Reference to Excise Invoices

Use

This procedure describes how warehousemen at manufacturing plants enter the receipt of goods procured externally if the excise clerk has already entered (captured or posted) the excise invoice using the Incoming Excise Invoices transaction.

You enter the goods receipt, following the standard procedure, and in addition, you enter the excise invoice number.

Procedure





a. Set the excise action to Only Refer Excise Invoice or, if you want to post the excise invoice, Refer & Post Excise Invoice.

b. Enter the official excise invoice number and the excise invoice date.

c. Choose .

The system displays all the information from the excise invoice. You cannot change it.

4. Enter line data as required, again, following the standard procedure. 5. Save the goods receipt.

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Result

If you set the excise activity to Only Refer Excise Invoice, the system creates:


� An accounting document to debit the inventory account and credit the GR/IR clearing account.


If the excise invoice that you referred to has not yet been posted, the next step is to post the excise invoice, for which you use the Incoming Excise Invoices transaction. Otherwise, the next step is to enter the vendor's invoice, when it arrives.

If you set the excise activity to Refer & Post Excise Invoice, the system also creates:



The next step is to post the vendor's invoice, when it arrives.

Entering Goods Receipts Without Excise Invoices

Use

This procedure describes how warehousemen at manufacturing plants enter the receipt of excisable goods procured externally if the excise invoice is not yet available.

You enter the goods receipt, following the standard procedure, and in addition, you also set the excise action as appropriate. You can still create an entry in Part I of register RG 23A or RG 23C, but the excise invoice number will be missing from it. It will be entered later on when the excise clerk captures the excise invoice.

Procedure




In addition, on the Excise Invoice tab, set the excise action to Part I Only.

4. Enter line item data as required, again, following the standard procedure. 5. Save the goods receipt.

Result

The system creates:



� A Part I entry in register RG 23A or RG 23C

However, the Part I entry is incomplete, as the excise invoice number is missing from it.

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The next step is to capture (and post) the excise invoice, for which you use the Incoming Excise Invoices transaction. When you do so, the system automatically links the excise invoice to the Part I entry.

Entering Goods Receipts for Nonexcisable Goods

Use

This procedure describes how warehousemen at manufacturing plants enter the receipt of nonexcisable goods.

You enter the goods receipt, following the standard procedure, and in addition, you also set the excise action as appropriate.

Procedure




In addition, on the Excise Invoice tab, set the excise action to No Excise Entry.

4. Enter line item data as required, again, following the standard procedure. 5. Save the goods receipt.

Result

The system creates:



That is the end of the procedure for nonexcisable goods.

Entering Goods Receipts and Subcontracting Challans Together

This procedure describes how warehousemen at manufacturing plants enter the receipt of goods from subcontract orders.

You enter the goods receipt, following the standard procedure, and in addition, you also enter the subcontracting challan details at header level and item level.

Procedure



2. In the top line, enter the subcontract order number and choose .

A dialog box appears, which is not relevant for subcontracting.

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3. Enter header data as required, following the standard procedure.


a. Set the excise action to Refer Subcontracting Challan.

b. Choose .

c. Enter the subcontracting challan number and the fiscal year, and choose .


Result

The system creates a material document to record the transfer from stock of material provided to vendor to normal stock.

The next step is to reconcile the subcontracting challan.

Entering Goods Issues and Excise Invoices for Transport Orders

Use

This procedure describes how warehousemen at manufacturing plants issue goods for a stock transport order placed by another manufacturing plant or depot.

You enter the goods issue, following the standard procedure, and in addition, you also enter the excise invoice details at header level and item level.

Procedure


Management → Goods Movement → Goods Issue (MIGO).



a. Set the excise action to Create Excise Invoice or Create & Post Excise Invoice. b. Enter any other data required.

c. If you have activated Immediate Utilization for the series group, choose . On the CENVAT

Utilization tab, specify which accounts you want to pay the excise duty from. Choose to close the dialog box.

4. Enter line item data as required, again, following the standard procedure.

In addition, check the data on the Excise Item tab, and change it if necessary.

5. Save the goods issue.

Result

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If you set the excise activity to Create Excise Invoice, the system creates:

� A material document to record the goods issue to stock in transfer

� An accounting document to debit the manufactured components in stock account at the issuing plant and credit the same account at the receiving plant


� An entry in register RG 1 (if you have customized the excise group accordingly, and if the goods are finished goods)

The next step is to post and print the excise invoice.

If you set the excise activity to Create & Post Excise Invoice, the system also creates:



The next step is to print the excise invoice.

Entering Goods Receipts and Excise Invoices Together at Depots

Use

This procedure describes how warehousemen at depots enter the receipt of goods and the incoming excise invoice for:

� Goods transferred from a manufacturing plant

� Goods purchased from a vendor

Follow the standard procedure, and in addition, enter the excise invoice details at header level and item level.

Procedure


Management → Goods Movement → Goods Receipt → For Purchase Order → GR for Purchase Order. 2. In the top line:

a. Set the reference document to Purchase Order. b. Enter the stock transport order number or the purchase order number.

c. Choose .



a. Set the excise action to Create RG 23D Entry.

If you have already entered a partial goods receipt for these goods and have entered the excise invoice already, select Create RG 23D Entry for Existing Excise Invoice.

b. Enter the official excise invoice number and the excise invoice date.

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If you have already entered the excise invoice, the system displays the information from the excise invoice created at the manufacturing plant. You cannot change any of the information at header level or item level.

Otherwise, enter header data as required.

4. If you have not yet entered the excise invoice, enter line item data as required, again, following the standard procedure.

In addition, on the Excise Item tab, change the data so that it matches the vendor's excise invoice, if necessary.


Result

The system creates:


� An accounting document to debit the inventory account and credit the GR/IR clearing account.

� An entry in register RG 23D

Entering Goods Issues and Excise Invoices Together at Depots

Use

This procedure describes how warehousemen at depots issue scrap and assign the goods issue to the appropriate folio number from RG 23D.

Procedure


Management → Goods Movement → Goods Issue (MIGO). 2. In the top line, set the reference document to Others.

3. Enter line item data as required, including the material and plant, and choose .

In the header, the Excise Invoice tab appears, and in the detail data, the Excise Item tab appears.

On the Excise Item tab, the system displays a list of goods receipts of this material that you have already entered, together with their folio numbers. The list is in chronological order. You can overwrite the proposed quantities.



a. Set the excise action to Only Select RG 23D. b. Enter any other data required.

5. Save the goods issue.

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Result

The system creates:

� A material document to record the goods issue

� An accounting document to credit the inventory account

� An entry in register RG 23D to record the goods issue

Multiple Goods Receipts for a Single Excise Invoice

Use Under normal circumstances, your vendors send you one excise invoice per delivery. Sometimes one excise invoice covers more than one delivery, for example, if you order a large quantity of oil and the vendor requires several trips to complete the delivery.

Prerequisites You have specified the maximum number of goods receipts per excise invoice per excise group, and whether you want multiple goods receipts with single or multiple CENVAT credits. You do so in Customizing for Logistics –

General, by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Excise Groups.

You have also specified which materials multiple goods receipts are allowed for. If you do not, the system will display a warning for each material when you come to post the excise invoice (see Material Master (Excise Data)).

Features The system allows you to control:

• Which of your excise groups allow multiple goods receipts (see above)

• Which materials you allow multiple goods receipts for (see above)

• When to credit the excise duty on the goods to your CENVAT account, either:

� As soon as the accounts supervisor has verified and posted the excise invoice, irrespective of whether the delivery has been made in full

� Whether to wait until the full quantity has been delivered

You have ordered a consignment of INR 800,000 worth of fuel from a vendor with excise duty at INR 80,000. The vendor sends the fuel in two batches. When the first batch arrives, the warehouseman posts the goods receipt for INR 400,000 (plus INR 40,000 of duty); the excise supervisor does not post the excise invoice for the quantity delivered. When the second batch arrives, you can credit INR 80,000 to your CENVAT account.

Activities Working with multiple goods receipts entails the following activities:

• Posting goods receipts

When you post a second (or third, or fourth) goods receipt for an excise invoice, the system prompts you to confirm that this is correct.

• Posting excise invoices

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When you come to post an excise invoice, the system displays all the receipts created for the invoice. If at material level multiple credit is disallowed, the system prompts you to confirm that you want to accept the credit. Otherwise, you can credit the CENVAT account for each receipt separately.

Capital Goods

Use

Businesses are allowed to set off excise duty on purchases of capital goods against excise duty on outputs. However, unlike with raw materials, you can only set off half of the duty in the first year, and the rest in any year after that.

Prerequisites

In the material master, you have classified the capital goods as such.

Because duty on capital goods is handled using excise transaction type CAPE, you must also have specified that you want this transaction to credit the excise duty to the CENVAT on hold account. You make this setting in

Customizing for Logistics – General, by choosing Taxes on Goods Movements → India → Account

Determination → Specify Excise Accounts Per Excise Transaction.

You must then have specified which G/L account is the CENVAT on hold account, again in Customizing for

Logistics – General, by choosing Taxes on Goods Movements → India → Account Determination → Specify G/L Accounts per Excise Transaction.

Features

When you post an excise invoice that contains capital goods, the system posts half of the excise duty to your CENVAT account and posts the rest to a G/L account for CENVAT on hold.

In following years, you can use a report to identify the capital goods with excise duty on hold and transfer the duty to the CENVAT account (see Transfer of CENVAT Credit on Capital Goods).

Activities

When working with excise invoices that include capital goods, note the following:

� Capturing vendor excise invoices

When you create an excise invoice with capital goods, you have to set the material type to A (assets), C (consumables), or T (tools).

� Posting excise invoices

When you come to post the excise invoice, the system posts only half of the excise duty to the CENVAT account. The system does not round the amount off.

Transfer of CENVAT Credit on Capital Goods

Use

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You use this report to display a list of the vendor excise invoices where the vendor has levied excise duty but you have not posted it (in full) to your CENVAT account.

This is particularly useful in the case of capital goods, in order to find out how much credit remains from previous years.

Features

To access the report, from the SAP Easy Access screen, choose Indirect Taxes → Procurement → Excise

Invoice → Reports → Balance Credit for Capital Goods.

Selection

On the selection screen, enter:

� Organizational data

� Data of the documents that you want

Output

The system displays a list of excise invoices with excise duty outstanding. It shows you:

� The total amounts of the various types of excise duties levied on the excise invoice

� How much duty has still to be posted to the CENVAT account

Select the excise invoices that you want and choose Transfer credit. If you want to transfer only a portion of the remaining amount, enter this amount as the amount to be credited.

The system creates an accounting document to post the duty to the CENVAT account and creates an entry in the Part II register.

Excise Registers

Use The excise authorities require you to maintain a number of registers relating to excise duty. They have to be printed out monthly and shown to the authorities in the event of an audit. The SAP system makes all the entries for these registers automatically, and you can prepare copies of them as and when necessary. Alternatively, you can download the data for processing by non-SAP software.

Features The SAP system handles the following excise registers:

• Register RG 1

• Register RG 23A and 23C, Parts I and II

• Register RG 23D

• Personal Ledger Account (PLA)

This is the bank account from which you transfer any money owing to the excise authorities.

• Register RT-12

This is a monthly report that summarizes the CENVAT and PLA information from the other registers.

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Activities For information about how to create the registers, see Creation of Excise Registers.

Register RG 1

Definition A register of excisable finished goods kept by manufacturing plants. The register shows goods movements from the factory to a store specifically for excisable finished goods.

Use The SAP system generates all the necessary entries in the register, and to prepare a copy of the register.

Set the material type to Finished Goods in the material masters that you use for finished goods.

Register RG 1 Entries

Use The SAP system creates all register RG 1 entries automatically.

Features In most cases, the system does not generate an RG 1 entry at runtime. It generates any missing entries when you execute the Register Update program (see below).

It assigns all entries a serial number.

Activities

Customizing

If you want the system to generate entries for goods issues entered using the standard Goods Movement

transaction, MIGO, specify in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

India → Basic Settings → Maintain Excise Groups.


The system does not automatically generate entries for goods receipts from production orders. You have to generate these yourself (see below).

Nor does it generate entries for goods issues, except for goods issues entered using the Goods Movements transaction if you have made the Customizing settings described above.

Periodic Processing

Generate the missing entries once a day using the Register Update program.

Reporting

Prepare a copy of the register as described under Creation of Excise Registers.

Register RG 23A/23C

Definition A record of receipts and issues of excisable materials, as kept by manufacturing plants. The register consists of two parts:

• Part I shows the quantities of the materials.

• Part II shows the amounts of excise duty on the materials, and how much you have transferred to the CENVAT accounts.

Previously, manufacturers were required to keep two separate registers, RG 23A and RG 23C for raw materials and capital goods respectively. This is no longer the case, but the distinction still remains in the system.

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Use The system generates all the necessary entries in the register. You can prepare a copy of the register as required.

Part I Entries

Use The SAP system creates Part I entries for all excisable goods movements.

Activities

Day-to-Day Activities When you enter a goods receipt for excisable materials, the system automatically asks you if you want to create the Part I entry in Register RG 23A or RG 23C. If so, the system generates a Part I entry. If not, it does not, but you can generate all missing Part I entries later.

The system automatically enters the excise invoice number in the Part I entry. If the excise clerk has already captured the excise invoice when the warehouseman enters the goods receipt, the system enters the excise invoice number in the Part I entry immediately. If the warehouseman enters the goods receipt before the excise clerk enters the excise invoice, the Part I entry does not contain a link to the excise invoice number. However, the system updates the excise invoice number automatically when the excise clerk captures the excise invoice later on.

The system does not automatically generate Part I entries for goods issues of excisable materials, with two exceptions:

• When you enter a goods issue for vendor returns

• When you enter a goods issue for stock transport orders for plants, but only when you use the Goods Movements transaction

Periodic Processing Generate the missing entries once a day using the Update of Registers RG 1 and RG 23 (Part I) program.

Reporting

Prepare a copy of the registers as described under Creation of Excise Registers.

Part II Entries

Use

Whenever you – as a manufacturing plant – post an incoming excise invoice, or create an outgoing excise invoice, the system automatically creates an entry in Part II of the appropriate register (RG 23A or RG 23C).

Features

The system assigns all Part II entries a serial number, and creates an accounting document for each, to transfer the various types of excise duty to the appropriate CENVAT account.

Activities


The system only creates a Part II entry when you post an incoming excise invoice. It does not create one if you only capture an excise invoice. That way, you can ensure that excise clerks can capture excise invoices but cannot make any Part II entries. The excise supervisors can then check and post the excise invoices posted by

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the clerks.

Similarly, the system also creates a Part II entry when you post an outgoing excise invoice.

Reporting

All Part II entries are shown when you prepare the excise registers.

CENVAT Document

Definition

An accounting document that the system automatically creates when it generates a Part II entry.

Use

Customizing

Specify which document type you want the CENVAT documents to use, in Customizing for Logistics – General,

by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Company Code Settings.


When the system generates a Part II entry for an incoming excise invoice, it creates a CENVAT document to debit the excise duty to the excise duty account, and credit it to the CENVAT clearing account:

The excise duty is cleared from the clearing account when the accounting clerk enters the vendor invoice.

When the system generates a Part II entry for an outgoing excise invoice, it creates a CENVAT document to debit the excise duty to the excise duty account, and credit it to the CENVAT suspense account:

Register RG 23D

Definition A record of receipts and issues of excisable materials, as kept by depots.

Use In procurement, when the warehouseman posts a goods receipt, the system creates a register entry.

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In sales, when a sales clerk creates a sales order, he has to specify which excise invoices were delivered with the goods that are being sold. Then, when the warehouseman posts the goods issue, the system generates another register entry.

The system generates all the necessary entries in the register. You can prepare a copy of the register as required.

Register RG 23D Entries

Use The system creates RG 23D entries for all receipts of excisable materials, and when you enter a goods issue, you specify which RG 23D entries the goods came from originally.

Activities

Day-to-Day Activities When you enter a goods receipt for excisable materials, the system generates a Part I entry in Register 23D.

The system creates one entry for each goods receipt, each of which is numbered with a serial number. Each entry contains a separate line item for each material in the goods receipt, and each line item has its own folio number.

When you enter a goods issue, you have to specify which folio numbers are associated with it. Again, each entry has its own serial number. The excise duty associated with these items is then added to the customer invoice.

Reporting

Prepare a copy of the registers as described under Creation of Excise Registers.

Example

A purchasing clerk places an order with a vendor. When the warehouseman enters the goods receipt, the system generates the appropriate RG 23D entry automatically, as follows:

The RG 23D entry contains a separate line item for each material in the goods receipt, and each line item has its own folio number.

Later that day, a second lot of goods is delivered. Again, the warehouseman enters the goods receipt in the system, and the system creates the RG 23D entry automatically.

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This is the second RG 23D entry, so the serial number is 0002. The folio numbers start at the next available number, in the example, 004.

Later on, a sales clerk enters a sales order. When the excise clerk selects the RG 23D entries to go with the goods issue, the system generates the following RG 23D entry:

Serial Numbers

Use

The system automatically numbers all entries in the following registers with a serial number:

� RG 1

� RG 23A and RG 23C, Parts I and II

� RG 23D

� PLA

Each excise group defines its own number range intervals.

Use

Customizing

Set up the number ranges in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

India → Tools → Number Ranges.


Whenever the system creates a register entry, it automatically assigns it a serial number.

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Reporting

The serial numbers are shown in the excise registers when you prepare them.

Creation of Excise Registers

Purpose

You follow this procedure to create the excise registers.

Process Flow

1. You update register RG 1 and the Part I registers daily.

This report updates any missing data for the RG 1 register, and Part I of the RG 23A and RG 23C registers. Its main purpose is to update the issue information in the Part I register, which is not otherwise tracked by the system.

2. When you need to submit the registers, you run the Data Extraction report, and the system saves the data to an internal table.

3. You run the Register Printout report, which reads the data from this table and prints it out.

Update of Registers RG 1 and RG 23 (Part I)

Use

You use this report to update the information in the following registers:

� RG 1

� RG 23A, Part I

� RG 23C, Part I

This report only creates register entries for goods movements that have not already been entered. It does not create duplicate entries.

You cannot print or display these registers using this report. It is solely for the purpose of updating the registers. Instead, to download the registers, use the Download Register Data report

Prerequisites

You have specified in the material master data which materials are to be entered in register RG 1.

For each of these materials, you have maintained the material form in table J_2IRG1BAL as below. Do not make any entries in fields that are not listed below:

Field Field entries

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Features

To access the report, from the SAP Easy Access screen, choose Indirect Taxes → Registers → Excise Tax → Update RG 23A/C Issues and RG 1.

Selection

On the selection screen, you specify:

� Which documents you want to cover:

� Enter general organizational details in the Company details group box.

� Enter details about the documents that you want to include in the register, in the Document header and Document details group boxes.

� Which register you want to update, in the Registers group box

� Whether you want to run the program in batch mode

You can also check what date the data was last extracted.

Output

The system displays a list of material documents that have not yet been entered in the register.

1. Select the documents that you want to add to the register. 2. To check if there is enough stock in the specific excise group for the register for issues or receipts, select

the line items and choose Simulate.

We recommend that you use this option before proceeding; it will show the line items that can be updated in the register.

EXGRP Material’s excise group

DATUM Date from which RG1 report is required, normally the date of going live

MATNR Material

FORM Enter P (Packed) or L (Loose). Do not leave this field blank.

WERKS Leave this field blank.

OP FN UOM Leave these fields blank.

All quantities in this table are updated in the base unit of measure of the material. OP BN UOM

CB FN UOM

USNAM User ID of the person filling out the table.

CPUDT Date of entry

CPUTM Time of entry

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Issues and receipts are handled separately based on the following register and classification code combinations:

� Lines that can be updated in the register will be shown with a green traffic light, while those which are not eligible (for example, if there is not enough stock on hand) will be marked with a red traffic light.

� You can reselect the required line items and repeat the Simulate process.

3. Select the line items you want and choose Register entry.

The system updates the Part I or RG 1 tables with the material documents.

For RG 1 issues to sales, wherever there is an excise invoice it is picked up and used for RG 1 updating.

The same option can be used for creating entries in RG 23A or RG 23C Part I registers. While creating entries in the register, system will pick up only those material documents for which Part I posting has not been done yet.

Data Extraction

Use

You use this report to extract the data in order to create the excise registers (see Creation of Excise Registers).

Register Type Goods issues Goods receipts

RG 23A IIM ROP

IPD

IWD

RG 23C IIM ROP

IPD

IWD

RG 1 IDH RMA

IDE ROP

IWE

IWT

IWO

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Prerequisites

You have entered the closing balance of the RG23A Part II, RG23C Part II, and PLA registers in table J_2IACCBAL, as they were on the day prior to your extracting the register data.

Assume you want the extract the registers from 1 January 2001. You have to maintain the closing balances in the table J_2IACCBAL as on 31 December 2000.

You make the entries in table J_2IACCBAL as described below:

Features

To access the report, from the SAP Easy Access screen, choose Indirect Tax → Registers → Excise Tax →

Field Entry

EXGRP Excise group of the registers

REGISTER Type of register

Make an entry for each of the following:

� RG23ABED

� RG23ASED

� RG23AAED

� RG23CBED

� RG23CSED

� RG23CAED

� PLABED

� PLASED

� PLAAED

� PLACESS

DATUM Date of the closing balance

WERKS Leave this field blank

OP BAL Leave this field blank

CL BAL Closing balance in the register

EXAMT Leave this field blank

EXIND Leave this field blank

USNAM User ID of the person making the entries

CPUDT Date of entry

CPUTM Time of entry

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Extract.

Selection


� If you select All registers, the system will create an extract for all registers. If you only want to create an extract for specific registers, select Select any register and then the registers that you want.

� If you want to find out when an extract was last created, select Last extracted dates. The system then displays the information in a dialog box.

Output

The system extracts the data. You can now print it out using the Register Printout report.

Register Printout

Use

You use this report to print out your excise registers.

Prerequisites

Before you can print a register, you must have extracted the data.

Features

To access the report, from the SAP Easy Access screen, choose Indirect Tax → Registers → Excise Tax → Print Utility Program.

Selection

On the first selection screen, you specify which excise register you want.

On the second selection screen, you specify:

� Which excise group and plant are to be covered

� Which period of time is to be covered

� Whether you want the debit entries to the accounts to be shown individually or consolidated for each day

Output

The system prints out the registers.

Download Register Data

Use

You use this report to download data from the registers listed below onto your hard drive. The information is

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saved in flat file format and can then be processed by non-SAP software to produce registers. This solution is thus an alternative to that described under Creation of Excise Registers.

This report covers the following registers:

� RG 1

� RG 23 A and RG 23 C (Parts I and II)

� PLA

� Plant excise details

You can only download data once.

Prerequisites

Before you can download the data for registers RG 1 and RG 23, you must have updated them (see Update of RG 1 and Part I Registers).

Features

To access the report, from the SAP Easy Access screen, choose Indirect Tax → Registers → Excise Tax → Data Download.

Selection

On the selection screen, specify:

� Which data you want to download (in the Register to be downloaded group box)

� Which documents are to be included (by document date and excise group)

� The location and name of the file that you want to save the information in (in the File name field)

Output

The system saves the data in a file on your hard disk. For information about how the files are structured, see:

� RG 1 � RG 23A and C, Part I and Part II � RG 23D � Plant excise details

Data Structure of Part I

Definition

The table below shows the data structure of the file that the system creates when you download the data from Part I.

Structure

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Field Length Use

REGTYP 1 Register

A RG23A

C RG23C

TRNTYP 4 Transaction type (GRPO = goods receipt)

EXGRP 2 Excise group

SNO 10 Part I serial number

SYEAR 4 Year of serial number

PDATE 8 Posting date

MAKTX 40 Material description

MENGE 13 Quantity

MEINS 3 Unit

EXNUM 10 Excise invoice number

EXDAT 8 Excise invoice date

NAME1 35 Vendor name

ORT01 35 City

PSTLZ 10 Pin code

EXCCD 20 Excise code number of vendor

EXCRN 20 Excise registration number of vendor

EXCRG 40 Excise range number

EXCDI 20 Division number

EXCCO 20 Excise collectorate of vendor

CHAPID 12 Chapter ID

P2NO 10 Corresponding Part II entry number

RISIND 1 Receipt/issue indicator

STATUS 1 Entry status

U Undeclared material

D Deleted item

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Data Structure of Part II

Definition

The table below shows the data structure of the file that the system creates when you download the data from Part II.

In case of Part II entries for debit and credit (except for capital goods), if the excise invoice contains multiple chapter IDs, then the excise value per chapter ID is shown in the lines immediately following the Part II entry. These entries have the same Part II serial number. Only the fields REGTYP, TRNTYP, EXGRP, SNO, SYEAR, EXNUM, EXDAT, BED, SED, AED, CESS, CURR, and CHAPID will have valid values.

In case of the Part II credit entries for capital goods, after the Part II entry, the excise amount is shown per excise invoice. These entries have the same Part II serial number. Only the fields REGTYP, TRNTYP, EXGRP, SNO, SYEAR, EXNUM, NAME1, ORT01, PSTLZ, BED, SED, AED, CESS, CURR will have valid values.

Structure

MBLNR 10 Material document number

MJAHR 4 Material document year

BWART 3 Movement type

Field Length Use

REGTYP 1 Register type

A RG23A

C RG23C

P PLA

TRNTYP 4 Transaction type

57CM 57F4 completion

57FC 57F4 subcontractor goods issue

57NR Non receipt of 57F4

CAPE Capital goods

CEIV Canceling the generated excise invoice

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DIEX Differential excise posting

DLFC Factory sale and stock transfer

GRPO Goods receipt (raw material)

MRDY Reversal without reference

MRRD Reversal in case of consumption other than production

MRWO CENVAT reversal for write of cases

TR6C PLA account adjustment through TR6 challan

OTHR Excise paid on other movements

EWPO Excise invoice without PO


SNO 10 Part II serial number

SYEAR 4 Year of the serial number

PDATE 8 Posting date

EXNUM 10 Excise invoice number

EXDAT 8 Excise invoice date

NAME1 35 Vendor/customer/subcontractor name

ORT01 35 City

PSTLZ 10 Pin code

EXCCD 20 Excise code number of vendor/customer/subcontractor

EXCRN 20 Excise registration number of vendor/customer/subcontractor

EXCRG 40 Excise range number (in case of credit entries)

EXCDI 20 Division number (in case of credit entries)

EXCCO 20 Excise collectorate of vendor/customer/subcontractor

BED 19 BED

SED 19 SED

AED 19 AED

CESS 19 CESS

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CURR 3 Currency

CHAPID 12 Chapter id

P1NO 10 Corresponding part I entry number (in case of credit entries)

PREPRN 10 Preprinted excise invoice number

CVDIND 1 CVD indicator (X = CVD)

EXPIND 1 Export indicator in sales

Blank Local sale

B Export under bond

D Deemed export

N Export without bond

CAPIND 1 Capital goods indicator

A Assets

T Tools

C Consumable

CERTNO 20 (Capital goods only) Field use depends on material type:

Assets Installation certificate number

Consumable Intimation document number

Tools Intimation document number

CERTDT 8 Intimation/certificate date (capital goods only)

ANLN1 12 Asset number (for capital goods: assets only)

REMARKS 50 Remarks

PROCES 50 Process for subcontracting challan

STATUS 1 Status

Space Normal

R Reversed

RDOC1 10 Reference document number

RYEAR1 4 Reference document year

LIFNR 10 Vendor number

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Data Structure of RG 23D

Definition

The table below shows the data structure of the file that the system creates when you download the data from RG 23D.

Structure

MBLNR 10 Material document number

MJAHR 4 Material document year

Field Length Use

INDCTR 1 Receipt/issue indicator

I Issue

R Receipt

EXNUM 10 Supplier's excise invoice number

EXDAT 8 Supplier's excise invoice date

NAME1 35 Vendor/consignee name

ORT01 35 City of vendor/consignee

PSTLZ 10 Pin code

EXCCD 20 Excise code number

EXCRN 20 Excise registration number



EXCCO 20 Excise collectorate


MENGE 13 Quantity

MEINS 3 Unit

CHAPID 12 Chapter ID

BED 19 BED

SED 19 SED

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Data Structure of Plant Master Data

Definition

The table below shows the data structure of the file that the system creates when you download the plant master data.

Structure

AED 19 AED

CURR 3 Currency

VBELN 10 Invoice (delivery document)

PDATE 8 Invoice date

NAME1B 35 Name of buyer

ORT01B 35 City of buyer

PSTLZB 10 PIN code of the buyer

Field Length Use

WERKS 4 Plant code

NAME1 30 Plant name 1

NAME2 30 Plant name 2

STRAS 30 Street and house number

PFACH 10 Post office box

PSTLZ 10 Postal code

ORT01 25 City

LAND1 3 Country

EXCCD 20 Excise code number

EXCRN 20 Excise registration number



EXCCO 20 Excise collectorate

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Data Structure of RG 1

Definition

The table below shows the data structure of the file that the system creates when you download the data from RG 1.

Structure

Field Length Use

MANDT 3 Client


SYEAR 4 Year of the serial number

SERIALN 10 RG 1 serial number

MBLNR 10 Number of a material document

MJAHR 4 Year of material document

ZEILE 4 Item in material document

BWART 3 Movement type (inventory)

MATNR 18 Material number

MENGE 7 Quantity

MEINS 3 Base unit of measure


RISIND 1 Receipt/issue indicator

DOWNL 1 Download indicator

DECLRD 1 Item declared for excise

EXPIND 1 Export type

REASON 40 Reason for movement

RDOC1 10 Reference document 1

RYEAR1 4 Reference year 1

RIND1 1 Reference document type 1

BEDRATE 3 Basic excise duty rate

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Monthly Return

Use

The central excise authorities have by vide notification no: 2000-(N.T) dated 28th April, 2000, prescribed the form of monthly return under rule 57AE of the central Excise Rules, 1944.

The SAP System offers you a report with which you can prepare the necessary printouts. It covers both of the following:

� Annexure

This is a list of all the invoices and bills of entry for which you have made a Part II credit posting over the past month. For each document, it shows the information required by the authorities.

� Abstract

This is a summary of the excise information from the annexure.

Prerequisites

You have maintained the vendor types in the vendor master data, so that they can be are shown on the list.

Features

AEDRATE 3 Additional excise duty rate

SEDRATE 3 Special excise duty rate

EXCUR 5 Currency

EXBAS 7 Base value for excise calculation

EXBED 7 Basic excise duty

EXAED 7 Additional excise duty

EXSED 7 Special excise duty

CESS 7 Cess amount

STATUS 1 Register entry status

USNAM 12 Created by

CPUDT 8 Document entry date

CPUTM 6 Time of entry

AEDAT 8 Changed on

AENAM 12 Changed by

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To access the report, from the SAP Easy Access screen, choose Indirect Taxes → Registers → Excise Tax → CENVAT Register.

Selection


� Organizational data

� Posting dates of the documents to be covered

� Whether you want to print the annexure or the abstract

If you want to print the annexure, you must also specify whether the report is required for inputs or for capital goods. If you want to print the abstract, the details are printed for both inputs and capital goods.

Depot Quarterly Returns Report

Use Depots (registered dealers) are required by law to submit a CENVAT return at the end of each quarter of the financial year. The return contains details about the excise duties on deliveries and issues of goods, as recorded in register RG 23D.

The return is due on the 15th of the month after the end of the quarter. For example, for the quarter ending 30 June, you must submit the return by 15th July.

The system offers a report that you can use to print out a return. To access the report, on the SAP Easy Access

screen, choose Indirect Taxes → Registers → Excise Tax → Depot Quarterly Returns Report.

ER1 Report (J2IER1)

Use The Government of India vide Notification No 26/2005-Central Excise (N.T.) prescribed the form E.R.-1 to be filled with excise authorities, by all the assessees (as defined under Central Excise Act) on a monthly basis for production and removal of goods and other relevant particulars and CENVAT credit.

You can run the report for a plant for a particular month. The system displays and prints the various sections of the form for a Registration Number of a plant for a particular month.

Activities

To access the report, run transaction J2IER1.

Enter the selection criteria. This is based on the Excise Group, Plant and a particular month.

Enter the Last Utilization Period. This is the period during which the excise duty credit has been used for the particular month. If you do not specify a period here, the system reads the last utilization period.

You can enter the General Ledger Account Number for the different service taxes. If you enter the Account Number, the system checks the amount against that service tax and prints it on the header of the form.

Select the section of the form that you want to display and print. For a complete ER1 reporting, you must print all the sections.

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Supplier Self-Services

Purpose The Supplier Relationship Management (SRM) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component.

The Indian tax laws require that excise duty should be paid by the buyer when the goods leave the vendor’s site.

Vendor needs to review the applicable taxes in the purchase order. Whenever a vendor dispatches the material, an Excise Invoice should accompany the goods. To enable these enhancements, additions have been made to the following functions of Materials Management system:

● Purchase Order or Scheduling Agreement Processing

● Excise Invoice Capturing After an Inbound Delivery is Created

Purchase Order or Scheduling Agreement Processing

Use This function allows you to transfer the tax and pricing data to the Supplier Self-Service (SUS) system when the purchaser creates or changes a Purchase Order or a Scheduling Agreement.

Prerequisites While processing a Purchase Order, in order to populate the pricing condition in segment E1EDP05 of IDoc ORDER02, you must create a view, using transaction WE32, for IDoc ORDERS02 and make the segment E1EDP05 as mandatory.

The processing function module IDOC_OUTPUT_ORDERS then populates the segment E1EDP05.

Only those tax and pricing conditions marked with X for print in tax and pricing procedures are passed to the SUS system.

Features ● To transfer tax and pricing data to the Supplier Self-Service (SUS) system, following new segments are

added to the ORDERS02 IDoc (new Purchase Order) and ORDCHG IDoc (changed Purchase Order):

� E1EDP04for tax data

� E1EDP05for pricing data

● The function module IDOC_OUTPUT_ORDERS has a BADI MM_EDI_ORDERS_OUT. The BADI has a Method - PROCESS_IDOC_SEGMENT. This method calls the Pricing Function Module, which populates the tax and pricing data into the IDoc segments.

The IDoc is then transferred to the adapter in the XI system.

● In XI, the tax and pricing information that are populated in E1EDP04and E1EDP05segments of the ORDERS02 IDoc have to be mapped to structures of Message Type PurchaseOrderRequest. In XI, the structures for tax and pricing do not exist. Hence, in order to do the mapping, corresponding data types are defined.

In Integration Repository (Design), there are additions of data types and data type enhancements.

These data type enhancements become a part of PurchaseOrderItem as an extension and can be used for mapping.

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● The adapter converts the IDocs into XML messages and sends them to the Supplier Self-Service system.

Excise Invoice Capturing after an Inbound Delivery of the ASN

Use When the vendor creates an Advance Shipping Notification (ASN) in the Supplier Self-Service (SUS) system, there is an Inbound Delivery in the system of the purchaser.

The purchaser can capture the Excise Invoice with respect to the Inbound Delivery in the following ways:

• The purchaser can configure the system to automatically run the transaction J1IEX with Vendor and Plant combination, whenever there is an Inbound Delivery of ASN.

• The purchaser can manually capture the Excise Invoice in the following ways:

○ Using transaction J1IEX with respect to Inbound delivery number of the ASN.

○ Using transaction MIGO for capturing the Goods Receipt with respect to the Inbound delivery number of the ASN.

The system defaults all excise invoice details from SUS. If the excise invoice has already been captured automatically, these transactions do not allow the capture of the vendor excise invoice.

The IDoc for Inbound Delivery is DELVRY01.

Sales and Distribution (SD)

Purpose

The Sales and Distribution (SD) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component.

Features


Country Version India comes with functions for calculating, posting, and remitting excise duty:

� The system determines the excise and other taxes on your sales.

� You can create outgoing excise invoices, customized to your own requirements, and make the appropriate accounting postings.

� The system offers functions for domestic and export sales from factories and depots, including exports under excise regulations.

� All goods movements are recorded in the appropriate excise registers, including register RG 23D.

� You can remit the excise duty using the delivered functions.

Country Template

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The country template for India comes with sample pricing procedures, including all taxes, and settings for automatic account determination to the appropriate excise accounts.

Excise Invoice (Outgoing)

Definition A business document, in India, that you prepare when you issue excisable goods from a manufacturing plant, for example:

• To be sold to a customer

• To be transferred to another of your plants

The excise invoice lists the goods that you have issued and states how much excise duty applies. Your customer uses the excise invoice to claim back the excise that it has paid from the excise authorities.

Use In the system, there are three different procedures for creating excise invoices

• Sales direct from the factory

This procedure is for when you sell manufactured goods straight from the factory at which they were produced, in which case you levy excise duty when the goods leave the factory on their way to the customer.

If, when you send the goods to the customer, you enclose the commercial invoice, you create the excise invoice with reference to the commercial invoice. If you want to send the commercial invoice after you have dispatched the goods, however, you create the excise invoice with reference to a pro forma commercial invoice. For more information about these procedures, see Sales from Factories.

As well as creating excise invoices individually, you can also create them in batches (see Creation of Excise Invoices in Batches).

• Sales from depots

A depot is a site at which the goods are stored, away from the factory at which they were produced. In this procedure, you have to levy the excise duty when you transfer the goods from the factory to the depot, and then make sure this is passed on to the customer when it makes a purchase. For more information, see Sales from Depots.

• Sales (other goods movements)

Some other goods movements may also require you to create an excise invoice with reference to other documents. The system offers separate functions for these purposes (see Other Outward Movements).

Structure

Numbering of Excise Invoices

Outgoing excise invoices have two numbers: an internal document number, which is assigned immediately you create an excise invoice; and an excise invoice number, which is not assigned until you have verified and posted it.

As far as the excise invoice number is concerned, you have to number your outgoing excise invoices in sequential order, starting each year on 1 April. You must notify the excise authority of the jurisdiction of the invoicing location. The serial number must be printed on each page of the excise invoice.

Each number range is governed by a series group. You must create at least one series group in order to be able

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to number the excise invoices. If you need more than one number range, you must create the corresponding number of series groups. You do so in Customizing for Logistics – General, by choosing Taxes on Goods

Movements → India → Basic Settings → Maintain Series Groups.

Number of Line Items Per Excise Invoice

Some states allow you to include only a limited number of items for each page of an excise invoice (for example, if the excise invoices are to be printed on prenumbered forms). You can customize the system so that it prints the

excise invoice accordingly, in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

India → Basic Settings → Maintain Excise Registrations.

Customer Master (Country Version India Data)

Definition

The part of the vendor master record where you record information about a vendor relating to sales tax, excise duty, and withholding tax.

To access the vendor master, from the SAP Easy Access screen, choose Logistics → Sales and Distribution →

Master Data → Business Partners → Customer → ….

Use

When you have entered the customer that you want to process, you can access the excise data from every screen, by choosing CIN Details.

There are three separate tabs, one for each sort of tax.

If you prefer, you can also maintain this data in the Excise Rate Maintenance transaction (see Customer Master (Excise Data)).

Pricing

Use

When you create a sales document, the system automatically determines the price of the goods you are selling, including any excise duties and sales taxes.

Features

Country Version India comes with four pricing procedures as follows:

� JINFAC (Sales from manufacturing plants)

� JINEXP (Export sales)

� JINDEP (Sales from depots)

� JINSTK (Stock transfers)

These pricing procedures determine the net price (or the assessable value, if there is one) and then calculate all forms of excise duties and sales taxes on the goods.

Excise Duties

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For each form of excise duty, there are three separate condition types as follows:

* These condition types show, for example, the total basic excise duty on the goods (ad valorem duty plus specific duty). It is the values in these condition types that the system uses in follow-on documents.

All of these condition types are discount surcharge conditions and are posted using the accounting key EXD.

The excise conditions are determined using the access sequence JEXC. This access sequence contains the following condition tables, so that you can create excise condition records for all of the following combinations:

* The chapter ID is stored in the control code field. When you enter a material's chapter ID in the material master, the system copies the chapter ID to the control code field. When you create a condition record, the field name is control code.

If you want to create condition records for different types of customers, for example, those that qualify for concessional tax rates and those that don't, you can define customer tax classifications in Customizing and create condition records for each classification.

Sales Taxes

For central sales tax and local sales tax, there are two condition records each, one for the basic tax (JCST and JLST respectively), and one for surcharges (JCSR and JLSR). These are all tax conditions and are posted with the account key MWS or MW3. When you create a condition record for the sales taxes, you must specify a tax code that you want the tax to be posted under in Financial Accounting (FI).

The system determines the central sales tax using the access sequence JCST, and local sales tax using the access sequence JLST. Both access sequences use the following condition tables:

Excise duty Ad valorem Specific Total*

Basic JEXP JEXQ JEXT

Additional JEAP JEAQ JEAT

Special JESP JESQ JEST

Cess JCEP JCEQ JCET

Table Conditions

362 Country, chapter ID*

357 Country, plant, chapter ID

358 Country, plant, chapter ID, material

371 Country, plant, chapter ID, ship-to party

369 Country, plant, chapter ID, customer tax classification

372 Sales organization, reference document and item

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Sales from Factories

Purpose This process describes how the SAP system handles sales from factories, allowing for the creation of excise invoices, which you have to send with each delivery that is subject to excise duty. There are two scenarios, depending on whether you want to send the commercial invoice along with the delivery or at a later date.

Prerequisites In order for the system to be able to copy the information from document to document, you must have set up the copying control procedures in Customizing for Sales and Distribution (SD). This differs according to when you want to send the commercial invoice:

• Along with the delivery

In this case, the document flow would be OR (standard sales order type) – LF (standard delivery type) – F2 (invoice).

• At a later date

The document flow would be OR – JF (delivery type, a copy of LF) – JEX (pro forma billing document type, a copy of document type F8) – F2.

In addition, you must also have maintained the settings in Customizing for Logistics – General, by choosing Taxes

on Goods Movements → India → Business Transactions → Outgoing Excise Invoices → Assign Billing Types to Delivery Types.

Two sample pricing procedures are provided for this sales procedure, J1INFAC (condition-based excise determination) and JFACT (formula-based excise determination).

Process Flow

The sales clerk creates a sales order, following the standard procedure.

There are special procedures for customers in possession of exemption forms.

The shipping clerk creates a delivery, again, following the standard procedure.

On the initial screen, you set the appropriate delivery type (see above).

The warehouseman enters the goods issue.

The system only allows users to create a pro forma excise invoice if the delivery is complete, so as to

Table Conditions

359 Plant, material group

367 Country, plant, region, material

368 Country, region of delivering plant, region of ship-to party, customer tax classification, material tax classification

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prevent them from creating multiple pro forma excise invoices.

What you do at this stage depends on whether you want to send the commercial invoice along with the delivery or whether you want to invoice the customer later.

� If the invoice is to be shipped with delivery, the shipping clerk:

i. Creates an invoice, following the standard procedure.

ii. Creates an excise invoice from the invoice

� If the invoice is to be sent on at a later date, the shipping clerk:

iii. Creates the pro forma excise invoice

The pro forma excise invoice is only required for technical purposes and is not sent to the customer. The system does not make any accounting postings at this stage.

iv. Creates an excise invoice from the pro forma excise invoice

In both these cases, the system creates an accounting document to post the excise duty to a clearing account.

Instead of creating excise invoices manually, you can also have the system create them automatically. Alternatively, you can create them in batches.

You ship the goods.

When the time comes to invoice the customer, you create the invoice, following the standard procedure.

Irrespective of the number of excise invoices that you have issued, you can combine the delivery items in a single invoice (if the standard requirements are met).

Automatic Creation of Excise Invoices

Use The system can automatically create an outgoing excise invoice for you immediately you post a commercial invoice (or a pro forma invoice) for a customer sale. This function applies to excise invoices for sales from factories only.

Activities

Customizing

Activate the function in Customizing for Logistics – General, by choosing Taxes on Goods Movements → India →


Specify which CENVAT accounts the system is to post the different types of excise duty to, in Customizing for

Logistics – General, by choosing Taxes on Goods Movements → India → Business Transactions → Utilization →

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Utilization Determination.

Specify which excise group and series group the excise invoices are to be created for, in Customizing for

Logistics – General, by choosing Taxes on Goods Movements → India → Business Transactions → Outgoing

Excise Invoices → Maintain Default Series Groups and Excise Groups.


When you post an invoice, the system creates an excise invoice. All the information that it needs to create the excise invoice is provided either by the invoice or by the Customizing settings that you have made. It also determines the excise invoice type automatically.

Exemption Forms

Use

Some customers may be liable to excise duty at reduced rates or exempt from it altogether (for example, customers abroad). Such businesses must provide you with a copy of their exemption forms in order to claim their exemption.

Activities

If you make a sale to a customer that is in possession of an exemption form, you have to record the form number in the sales order. The system then automatically applies the appropriate rate of excise duty.

When you create the sales order, enter the form, using the customer tax classification fields. Based on the customer tax classification status, you can use different excise rates for a sale transaction.

If the form has not been submitted by the time you create the pro forma excise invoice, the excise value will be recalculated at the normal rate.

See also:

Form Tracking

Export-Oriented Units

Use

Any sales that you make to export-oriented units (EOUs) require special treatment by the SAP System.

Prerequisites

You have maintained a zero-rate excise duty indicator for customers that qualify as 100% EOUs.

Activities

When you come to create the excise invoice, the excise value is zero in the pro forma excise invoice document. No excise duty is debited to the CENVAT account, and so no accounting entries are generated. However, the sale is marked as a deemed export, and the system generates an outgoing excise invoice.

Even though the excise duty is zero, when you print the excise invoice, the system calculates the duty for the purposes of printing.

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Creation of Excise Invoices in Batches

Use

You use this report to create excise invoices for batches of invoices and batches of pro forma excise invoices, instead of creating each one individually (see Sales from Factories). The excise invoices are then created in the background.

Features

To access the report, from the SAP Easy Access screen, choose Indirect Taxes → Sales/Outbound

Movements → Excise Invoice → For Sales Order → Batch Utilization.

Selection

On the selection screen, specify which billing documents (invoices or pro forma excise invoices) you want to create excise invoices for.

Output

A list of commercial invoices and pro forma excise invoices appears, which you process as follows:

1. If you want to see how much credit is available on your CENVAT accounts – and if there is enough to cover the excise duty that you will incur when you create the excise invoices – choose Account balances.

A dialog box appears with the following information:

� The amounts under Balances are the amounts available on the CENVAT accounts.

� The amounts under Utilization are the total amounts of the excise duties to be levied.

� If the CENVAT accounts do not contain enough credits to cover the excise duties, the amount short is shown under Deficit.

2. When you know which documents you want to process, select them and choose Batch utilization.

Printout of Excise Invoices

Use

You use this report to print outgoing excise invoices.

Prerequisites

You have:

� Customized the output for billing documents

You can do so in Customizing for Sales and Distribution (SD), by choosing Basic Functions →

Output Control → Output Determination → Output Determination Using Condition Technique → Maintain Output Determination for Billing Documents.

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You can use output type J1I0 and the SAPscript form J_1I_EXC_INVOICE. The driving program is J_1IEXCP. The output determination has been set up for the billing document that is used as the excise invoice reference.

� Maintained condition records for the output

You can do this in Logistics → Sales and Distribution → Master Data → Output → Billing Document → Create. This ensures that output gets copied to all the excise reference documents.

Features

To access this function, from the SAP Easy Access screen, choose Indirect Taxes → Sales/Outbound

Movements → Excise Invoice → For Sales Order → Print.

Selection

On the selection screen, enter the numbers of the excise invoices. If any of these are reprints, select Incl. printed excise inv.

Output

From the list of excise invoices, you have the following options:

� To display an excise invoice, select it and choose .

� To print an excise invoice, select it and choose .

Creating Pro Forma Excise Invoices

You create a pro forma excise invoice as you would create any other billing document, but in the Billing type field, select Excise invoice.

Creating Excise Invoices

Use

This is the standard procedure that you follow to create an outgoing excise invoice. You create the excise invoice from a reference document: either an invoice, a pro forma excise invoice, or a billing document.

Prerequisites

You have:

� Customized the rounding-off indicator for sales transactions

� Specified which exchange rate type to use for export invoices

You make both of these settings in Customizing for Logistics – General, by choosing Taxes on Goods

Movements → India → Basic Settings → Maintain Company Codes.

Procedure

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1. From the SAP Easy Access screen, choose Indirect Taxes → Sales/Outbound Movements → Excise

Invoice → For Sales Order → Outgoing Excise Invoice Create/Change/Display → …

� If you want to create the excise invoice with reference to a pro forma excise invoice or commercial

invoice, choose Excise Invoice → Create.

� If you want to create the excise invoice with reference to a delivery note, choose Exc. inv. for

delivery → Create.

2. Enter the number of the reference document.

If you do not know the document number, you can search for it by choosing Due list.

3. Choose .

The excise invoice screen appears. The header data is displayed at the top; the line items, which the system has copied from the reference document, are displayed at the bottom.

4. Enter header data as required.

5. To check if the utilization is done properly and the document is ready for posting, choose .

6. To enter texts for the excise invoice, choose . 7. To display the balances of the CENVAT accounts, choose Balances.

8. To display the utilization details, choose . 9. Save the excise invoice.

Excise Duty Utilization

Use

When you create an excise invoice, the system allows you to display the information about the excise duty,

including which CENVAT accounts the excise will be debited to. To access this function, choose .

If a company defaults in the fortnightly payment of CENVAT, the excise collectorate can enforce an immediate payment of excise. Alternatively, you may have excess CENVAT credit and want to pay the duty immediately and not wait for a fortnight. This is also the case for some export removals where you claim the refund from DGFTA, in which case you need to pay the duty immediately.

Prerequisites

You can enable the immediate utilization of CENVAT, in Customizing for Logistics – General, by choosing Taxes

on Goods Movements → India → Basic Settings → Maintain Series Groups.

Features

The information is shown in two group boxes:

� Excise details

This shows you the excise invoice type, which you can change if necessary by choosing . It also shows you how much excise duty will be charged on the sale.

� Balance utilization

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This shows you which CENVAT accounts the excise duty will be debited to.

The system automatically proposes which CENVAT accounts it is to debit the excise duty to. It first takes the RG 23 accounts, and if there is not enough credit to cover it, it debits the remainder to the personal ledger account (PLA). The cess component of excise can only be taken from the PLA.

If immediate utilization is active for a series group, you can change the default utilization proposal. You can decide from which register to pay the amount. When you save the invoice, the system generates Part II entries in the appropriate registers. These excise invoices are not listed further during fortnightly payment of CENVAT.

If immediate utilization is off for the series group, the system proposes the excise duty values directly in the RG 23A fields, but the postings are made to intermediate accounts for excise duty. The system does not create any Part II entries. Entries are posted into a dispatch register. When you then run the fortnightly payment program, the system picks up these invoices and allows payment of CENVAT.

For information about debiting the excise duty to a different company, see Intercompany Excise Duty Utilization

Excise Invoice Type

Use The excise invoice type denotes whether the goods are for the domestic market, or if they are for export, whether they are for export under bond, deemed export, or export under rebate. For more information about these processes, see Excise Bonding.

Features In the system, when you set the excise invoice type, it controls:

• How the excise duty is calculated

• Which ARE documents you process the export with

Activities When you come to create an excise invoice for an export sale, if you need to change the excise invoice type, follow this procedure:

Set the excise invoice type to Deemed, Bond, or No bond.

Choose Calculate Tax.

The system recalculates the excise duty according to the excise invoice type (see below). To do so, it translates the assessable value into the local currency as at the excise invoice date. What happens next depends on the excise invoice type:

� Exports under bond

The system sets the excise duty to zero and generates an outgoing excise invoice. It does not generate any entries for the Part II register.

The excise invoice is created with an export excise invoice number.

� Deemed exports

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The excise to be paid will be zero. This information will be used when the Part II registers are downloaded.

When the system creates the excise invoice, it numbers it as a domestic excise invoice.

� Nonbonded exports

The system applies the tax code defined in Customizing for Logistics – General, under Taxes on

Goods Movements → India → Basic Settings → Determination of Excise Duty → Maintain Excise Defaults, and calculates the excise duty as normal.

Again, the excise invoice is created with an export excise invoice number.

Excise on Intercompany Billing Documents

Use

The SAP System allows you to create an excise invoice for intercompany billing documents.

For example, assume one company code places a sales order, and the goods are delivered to another. The first company has to create an excise invoice, in this scenario, with reference to the intercompany billing document.


Use

You follow this procedure in order to cancel an outgoing excise invoice. It reverses any excise duty accounted for.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → Cancel exc. inv. or

Indirect Taxes → Sales and Outbound Movements → Excise Invoice Create/Change/Display → . 2. Enter the number, year, and series group of the excise invoice that you want to cancel.


3. Choose Yes. 4. Save the adjustment posting.

Sales from Depots

Purpose

You may sell finished goods directly from the place of manufacture, as described under Sales from Factories, or you may first ship them to a separate location for storage (a depot), from where you will sell them. The second procedure is described here.

Sales from depots are handled differently from sales from factories because of excise law: Excise duty is payable

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when you send the goods from the factory to the depot, but it is not levied again when you sell the goods.

Sometimes when you make a final sale of goods from a depot, price escalations could have happened with retrospective effect. In such scenarios you need to pay the extra excise duty at the factory using an A Certificate. You need to register the A certificate details in the RG 23D register and the excise recovered from the customer.

Prerequisites

You have customized:

� Stock transport processing, in Customizing for Materials Management (MM), by choosing Purchasing →

Purchase Order → Set Up Stock Transport Order

� The copying control for copying stock transport order NL to excise invoice JEX

Make this setting in Customizing for Logistics – General, by choosing Taxes on Goods Movements →

India → Business Transactions → Outgoing Excise Invoices → Assign Billing Types to Delivery Types.

� The item category NLN (standard transport order) so that it is relevant for billing

You do this in Customizing for Sales and Distribution (SD), by choosing Sales → Sales Documents → Sales Document Item.

Process Flow

1. You create the sales order, following the standard procedure.

The standard pricing procedures for depot sales are J1INDEP (condition-based excise determination) and JDEPOT (formula-based excise determination).

2. You create the delivery, again, following the standard procedure. 3. You assign excise invoices to the delivery or material document. 4. You verify that you have selected the correct excise invoices and post them. Alternatively, if you have

selected the wrong excise invoices, you can cancel the assignment.

5. You create the invoice, following the standard procedure.

Creating Excise Invoices for Stock Transfers

1. From the SAP Easy Access screen, choose Indirect Taxes → Procurement → Excise Invoice → For

Depot → Create/Change/Display.

2. In the Material document field, enter the goods receipt number and choose .

The system displays the information from the goods receipt, for example, the sending plant, the excise registration, the range, the division, and the collectorate.

3. Choose Details.

The system copies the items from the goods receipt document. In the depot it is possible to have a separate excise invoice at line item level.

4. Enter the internal document number of the excise invoice sent by the factory.

5. Choose More documents to go the excise invoice details screen.

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6. Enter the internal document number of the excise invoice from the factory.

The system copies the information to the line item (for example, the excise invoice number, the excise invoice date, the item number , the chapter ID, the excise invoice quantity, the amount of excise duty paid, the excise base value, and the serial number of the Part II register entry with which the excise was paid).

You can change the receipt quantity to match the actual quantity received at the depot, if necessary. The system automatically adjusts the excise accordingly.

7. Go back to the item details screen. 8. Save the excise invoice.

The system creates an entry in register RG 23D.

Creating Excise Invoices for Direct Purchases


Depot → Create/Change/Display.

2. In the Material document field, enter the goods receipt number and choose .

The system displays the information from the goods receipt, for example, the sending plant, the excise registration, the range, the division, and the collectorate.

You can also maintain the excise registration details for the ship-from party, as for with the vendor. The ship-from can be different from the vendor code. (The delivering plant can be maintained as a ship-from in the system. When a valid ship-from is entered, the excise registration details copied from the vendor will be overwritten by the ship-from excise registration details.)

The ship-from registration details displayed can also be overwritten manually.

The dealer's commercial invoice number can be stored in the vendor excise invoice number, as in this case the dealer himself will not have an excise invoice.

3. Choose Details.

The system copies the items from the goods receipt document. It also copies the vendor's excise invoice number and the serial numbers of the entries in the RG 23A, RG 23C, and personal ledger account (PLA) registers.

4. Enter the internal document number of the excise invoice sent by the factory.

5. Select an item and choose More documents to go the excise invoice details screen.

In the case of direct purchases, there will not be any excise invoice in the system, so leave the internal document field blank. The vendor's invoice will show the details of the excise invoices through which excise has been paid for the item that is being dispatched. You can enter these details here.

6. For each item, the chapter ID, excise base value, and excise duty amounts are defaulted from the purchase order. You can change them if there is any difference. Enter the excise amount paid and the receipt quantity. You also enter the Part II register serial numbers with which the excise duty was paid and the excise registration information from the original excise invoice.

7. Go back to the item details screen. 8. Save the excise invoice.

The system creates an entry in register RG 23D. You can change the excise invoice as long as it has not

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been used in any sales.

Creating Additional Excise Entries at Depots


Depot → Additional Excise Entry at Depot. 2. In the Internal exc. inv. no. field, enter the internal excise invoice number at the depot along with the year,

and choose .

The system displays the information from the excise invoice which has already been created at the depot, including the excise group, vendor excise invoice number, ship from, and all the receipt against that excise invoice, highlighting the RG 23D folio and serial numbers.

An excise invoice item can have multiple A certificates attached to it. The A certificates will have the same folio number as the original line item, but the serial numbers will be different. A hierarchy icon differentiates the additional lines for an item line.

3. You can maintain the A certificate number, date, and additional BED, AED ,SED and CESS for a given RG 23D Folio.

4. After entering an A certificate you cannot delete the A certificate from the system, but you can change it until it is picked up during removals from the depot.

5. If some of the values in an A certificate are incorrect, you can make the values zero so that they do not have an impact on the final excise value.

6. Once an A certificate is used for removals then it cannot be changed. 7. Save additional excise entry.

The system creates an entry in register RG 23D. Folio number generation must be active for you to make use of this supplementary invoice functionality at depot.

Assigning Excise Invoices to a Delivery

Use

You follow this procedure to specify which excise invoices are to be assigned to a delivery from a depot (or other material document).

You can also automate this procedure, using the batch selection program (J_1IJCHK), by making the appropriate Customizing settings in the Country Version India (CIN) Implementation Guide (IMG).

Procedure


Invoice → For Depot → Create/Change/Display → Delivery or Material Document → RG 23D Selection.

2. Enter the delivery document number or the material number and choose . 3. Select the excise invoice you want.

4. Choose . 5. Choose Excise invoice.

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A list of excise invoices appears. These are the excise invoices at the depot with a balance quantity.

The system also shows a list of the A certificates that can be used. You can pick up any of the A certificates, but they must be for the same excise invoice. You can only pick up an A certificate in its entirety. You cannot select part of an A certificate.

6. Select the excise invoices that are relevant to the delivery. 7. Specify what quantity to be used from each excise invoice.

The system recalculates the excise accordingly.

8. Go back to the item details screen. 9. Save the data.

Result

The system creates an entry in register RG 23D and generates the depot excise invoice numbers.

If you selected any A certificates, the system also generates additional entries in the RG 23D register. The system marks the original A certificates as updated, so that they cannot be used for any other removals.

Verifying and Posting Excise Invoices Assigned to Delivery

Use

You follow this procedure to verify that the correct excise invoices have been assigned to a delivery. If everything is correct, you can then post the delivery.

Prerequisites

You have selected which excise invoices are to be assigned to the delivery and have posted the goods issue.

Procedure


Invoice → For Depot → Create/Change/Display → Delivery or Material Document → Verify/Post.

2. Enter the number of the delivery that you want to verify and choose . 3. Make sure that the information is correct. 4. Save the data.

The system updates the posting flag in the RG 23D register.

Other Outward Movements

Use In the standard procedure for creating outgoing excise invoices (see Sales from Factories), the excise invoice is created with reference to a delivery note or an invoice. The system also allows you to create an excise invoice with reference to various other documents, as follows:

• Goods issue documents (for example, transfer postings)

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• Vendor excise invoices (for when you return faulty goods to a vendor, for example)

• Factory excise invoice (for sales returns)

In addition, you can create an excise invoice without reference to any document at all.

Prerequisites You have specified, per excise group, whether you want to create these excise invoices in one or two steps (see

below). You do so in Customizing for Logistics – General, by choosing Taxes on Goods Movements → India →


You have also specified the maximum number of items allowed per excise invoice, in Customizing for Logistics –

General, by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Excise Registrations.

Features Depending on your Customizing settings, you create excise invoices in a single step or in two steps, as follows:

• In the two-step procedure, the excise clerk first creates the excise invoice, but no postings are made. An excise supervisor then verifies that the invoice is correct and, if so, posts it.

• If the excise clerks are more experienced, you may want to use the one-step procedure, which is quicker, but more prone to error.

In this case, when you create an excise invoice, the system automatically posts it in the background.

Note that the functions for creating and canceling these excise invoices are different from those for other excise invoices.

Creating Excise Invoices

Use

This is the procedure that you follow to create an excise invoice for the less common types of goods movement.

Procedure


Invoice → For Other Movements → Create/Change/Display → . 2. On the selection screen, enter data as required, including:

� Reference group box

Specify which document you want to create the excise invoice for and which excise group it is for.

� Details group box

Specify the vendor or customer that you are sending the invoice to.

3. Choose .

If you entered an internal document number, the system copies the item details from it.

4. Choose . 5. Enter line items for each of the materials to be included in the excise invoice. For each item, enter the

following data:

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� Material

� Quantity

� Unit of measure

� Base value

� Excise duty

6. To pick the rate and amount from a specific excise invoice, choose Get excise invoice. 7. Save the excise invoice.

If you are using the one-step procedure, the system creates and posts an excise invoice. Otherwise, the system saves the information but does not make any postings: it now has to be verified.

Verifying and Posting Excise Invoices

Use

You follow this procedure to verify that the information in an excise invoice that has already been created, and to post it once you are satisfied.

Procedure


Invoice → For Other Movements → Post Excise Invoice. 2. Enter the internal document number of the excise invoice. 3. Choose Release to accounting.

The system displays the excise invoice. The excise duty that is to be posted is displayed at the foot of the screen, which you can change if necessary.

4. To access the balance utilization, choose . 5. To display the balance available on the CENVAT accounts, choose Account Balances. 6. Save the excise invoice.

The system generates the accounting documents.

7. To print the excise invoice, choose .



Invoice → For Other Movements → Create/Change/Display → . 2. Enter the internal document number.

3. Choose .

A dialog box appears, asking you to confirm whether you want to delete the excise invoice.

4. Choose Yes.

Creating Excise Invoices for Stock Transfers

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Use

Follow this procedure to create an outgoing excise invoice for a stock transfer to another plant. For more information about this function, see Other Outward Movements.

Procedure


Invoice → For Other Movements → Create/Change/Display → . 2. On the selection screen, enter data as required, including:

� Ref. doc. type: MATD (Material document) � Doc. number: Transfer posting number

� Vendor: Leave this field blank

� Customer: The customer account number of the receiving plant

3. Choose .

The system copies the details from the transfer posting.

4. For each item:

� Enter the net assessable value

� Check and change the excise duty rates

5. Save the excise invoice.

If you are using the one-step procedure, the system creates and posts the excise invoice. Otherwise, the system saves the information but does not make any postings: it now has to be verified.

Making a Transfer Posting

Use

In this procedure, you make a transfer posting for the goods ordered by another plant. For more information about

this function, see Entering the Removal from Storage at the Issuing Plant.

Procedure


Management → Goods Movement → Transfer Posting.

2. Choose Movement type → Transfer posting → Plant to plant → To stock in transit. 3. Enter the number of the issuing plant and storage location. 4. Choose To purchase order. 5. In the dialog box, enter the number of the stock transport order that the receiving plant created and choose

. 6. Check the data. 7. Save the transfer posting.

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Exports Under Excise Regulations

Use Manufacturing plants are entitled not to pay any basic excise duty on export sales, as long as the goods are accompanied by an ARE document. The system handles AREs and the appropriate permit documents, such as export bonds and deemed export licenses.

The system does not handle exports to Nepal and Bhutan, which are subject to separate legislation.

Features The system allows you to process three types of exports:

• Exports under bond

• Exports under claim for rebate

• Deemed exports

You must create an ARE document for all goods that you export under these schemes. You use the same function to process all ARE documents. For information about how to use the function in general, and which features are common to all ARE documents, see ARE Documents.

Exports Under Bond

Use

One of the ways of exporting goods without paying basic excise duty is to obtain an excise bond from the excise authorities and then fill out an ARE-1 document to go with every export.

Activities

Customizing

Carry out the IMG activities in Customizing for Logistics – General, under Tax on Goods Movements → India →

Business Transactions → Exports Under Excise Regulations → Exports and … → Printouts of ARE Documents.

Master Data

Enter your excise bonds in the system.


In order to qualify for an exemption from excise duty, all exports must be accompanied by the appropriate paperwork, including an ARE-1 document, and you must complete the export within the export period. To process and track ARE-1s, use the ARE Documents functions, following the process described under ARE-1 Processing.

You can only issue an ARE-1 under a bond. The system automatically keeps track of the bond balance.

There are two ad-hoc reports that you can use for tracking bonds and ARE-1s: Bond Summary Report and Aging Analysis for ARE Documents.

Reporting

There are two statutory reports that you prepare at least once a month, Pro Forma of Running Bond Account and

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Statement Regarding Export of Excisable Goods.

Excise Bond

Definition A document that effectively licenses a manufacturing plant to remove goods from its premises without paying basic excise duty, on condition that the goods are then exported.

An excise bond covers a fixed amount of excise duty. The excise duty of the goods exported under bond cannot exceed the bond value.

In the system, the term "excise bond" also covers letters of undertaking, and all of the excise bond functions apply equally to letters of undertaking, unless stated otherwise.

Use

Master Data

When you obtain a bond from the excise department, enter it in the system. The system numbers each bond automatically.


When you assign an ARE-1 to a bond, the system automatically warns you of any reservations that have already been made against the bond.

The system keeps track of the bond balance for you. When you post an ARE-1, the bond balance decreases automatically. In the case of running bonds, the balance increases again when you close the ARE-1.

Once an excise bond is no longer of any use to you, for example, if it expires or if you have exhausted a fixed bond, you can close it. This prevents any users from using it afterwards.

Reporting

You can use the system to prepare two statutory reports, the Pro Forma of Running Bond Account and the Statement Regarding Export of Excisable Goods. One further report, the Bond Summary Report, gives you an overview of all of your bonds.

Bond Numbering

Use

When you create an excise bond, the system automatically assigns it an internal bond number.

Each bond also has an official bond number.

Activities

Customizing

Maintain the number range object for the internal bond number in Customizing for Logistics – General, by

choosing Tax on Goods Movements → India → Tools → Number Ranges.

Master Data

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When you enter an excise bond, you enter the official bond number manually. When you save the bond, the system automatically assigns it a new internal bond number.

Bond Balance

Use

Each excise bond only covers a limited amount of basic excise duty, the bond value. Every time you post an ARE-1, the system reduces the bond balance automatically.

Features

Every time you post an ARE-1 under a fixed bond, the system debits the excise duty stated on the ARE-1 to the bond, which reduces the bond balance. When the balance reaches zero, the bond is exhausted.

Running bonds, on the other hand, are automatically replenished: Once an export is complete and the excise department sends you confirmation that the ARE-1 is correct, the system automatically credits the excise duty back to the bond (but see also Fast Credit).

You can check the bond balance at any time in the bond master or the Bond Summary Report. If you want to check the debits and credits on a running bond, use the Pro Forma of Running Bond Account.

Fast Credit

Use

When you close an ARE-1 covered by a running bond, the system credits the excise duty back to the bond automatically.

However, some local excise departments may allow you to credit the excise duty back as soon as you receive the countersigned ARE-1 back from the customs department. This procedure is known in the system as fast credit.

Activities

Customizing

If you have a fast credit agreement with its local excise department, enter this information in Customizing for

Logistics – General, by choosing Tax on Goods Movements → India → Business Transactions → Exports Under

Excise Regulations → Exports → Make Settings for ARE-1 Procedure.


If you do not have a fast credit agreement, the system credits the excise duty to the running bond when you close the ARE-1.

With fast credit, the system credits the excise duty back to the running bond when you enter the Arrived Back date (see Updating ARE-1s).

Reservations

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Use The system records the total amount of excise duty from ARE-1s that you have created (but not yet posted) under a given bond.

This reservation amount is for information only. It serves to warn you, when you create an ARE-1, that other clerks have already created other ARE-1s under a bond and that they intend to post them under this bond as well.

Activities When you create a new ARE-1 in the system, you specify which bond the ARE-1 is covered by. When you do so, the system displays the bond's reservation amount.

If the reservation amount is already over the bond balance, you might want to use a different bond, if another one is available. But since the reservation amount is for information only, the decision is up to you.

Processing Excise Bonds


Taxes → Master Data → Excise Bond.

ARE-1 Processing

Purpose This procedure describes how you process ARE-1s for exports under bond.

Prerequisites You have an excise bond from the government and have entered it in the system.

You have received a sales order from a customer located abroad. In the system, you have already created the delivery and the outgoing excise invoice. In the excise invoice, you have set the excise invoice type to Export Under Bond.

Process Flow

The excise clerk creates an ARE-1.

He then calls the local excise department and asks them to send an excise officer to check the goods.


Create an excise bond → Create

Change an excise bond → Change

Display an excise bond → Display

Cancel an excise bond → Cancel You can only cancel a bond if you have not yet used it.

Close an excise bond → Close You must have closed all of the ARE-1s that the bond covers.

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The excise officer comes and checks that the goods match what is on the ARE-1. He fills out Part A of the form (Certification by the Central Excise Office).

The clerk then posts the ARE-1 and prints out the requisite number of copies.

The excise officer signs the ARE-1s and takes one copy with him.

The shipping department sends the goods to be exported, together with the excise invoice and the ARE-1.

Before the goods can leave the country, they have to go through the customs office, for example, at the airport or at the port.

When the goods arrive at customs, the customs officer checks whether the excise invoice and the ARE-1 match the goods.

If he finds that there are fewer goods than stated on the ARE-1, he enters the shortfall in the ARE-1.

He then fills out Part B of the ARE-1 (Certification by the Customs Officer) and sends it back to the excise clerk. One of the copies is in a sealed envelope.

When the excise clerk receives the ARE-1, he updates the ARE-1 in the system.

He fills out the various certification dates in the ARE-1 (for example, the date when the ARE-1 arrived back at your company).

If the customs officer noted a shortfall in the quantity of goods, the excise clerk enters the shortfall as well. Since the whereabouts of the missing goods cannot be accounted for, they no longer qualify for exemption from excise duty. Your company is therefore liable for the excise duty on the shortfall, plus interest, backdated to the date when you removed the goods from your premises. The clerk specifies which excise registers to pay the excise duty from.

The clerk sends the ARE-1 in the sealed envelope to the excise department.

The excise officer cross-checks this copy of the ARE-1 with his own copy. When he is satisfied that everything is correct, he sends the excise clerk a final confirmation.

When the excise clerk receives the confirmation, he closes the ARE-1.

The process is now complete.

Creating ARE-1s

Use

You create an ARE-1 when you want to export goods under bond.

Procedure

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1. From the SAP Easy Access screen, choose Indirect Taxes → Sales/Outbound Movements → Exports

Under Excise Regulations → Exports → Central Processing → Create ARE-1. 2. In the top line:

a. Select Create ARE-1. b. Select Outgoing Excise Invoice.

c. Enter the excise invoice that the ARE-1 is for and choose . d. If the ARE-1 is to cover more than one excise invoice, repeat step (c) for each of them.

3. Assign an excise bond to the ARE-1. 4. On the Addresses tab, enter the addresses of your local excise department and the customs department

that will process the ARE-1.

Their addresses will be printed on the ARE-1. For more information, see Automatic Address Determination.

5. On the Additional Data tab, maintain any long texts required in the ARE-1.

This information will be printed on the ARE-1. For more information, see Long Texts.

6. On the Package Details tab, enter any relevant information about how the goods are packaged.

This information will also be printed on the ARE-1.

7. Save the ARE-1.

Result

The system:

� Creates the ARE-1 and assigns it an internal ARE-1 number (see ARE Document Numbering) � Increases the bond's reservation amount � Sets the document status to In Process

The next step you have to carry out in the system is to post the ARE-1. If you need to, you can still cancel the ARE-1.

Changing ARE-1s

Use

Once you have created an ARE-1, you can still change the following information until you post it:

� Which excise bond it is assigned to � Which excise invoices are assigned to it � Which addresses are entered � Any long texts � Any package details

Procedure


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Under Excise Regulations → Exports → Central Processing → Change ARE-1. 2. In the top line:

a. Select Change. b. Select ARE-1 Internal Document.

c. Enter the internal ARE-1 number and choose .

3. Change data as required. 4. Save the ARE-1.

Assigning Excise Bonds to ARE-1s

Use

When you create an ARE-1, you must specify which bond covers it. You can change the bond until such time as you post the ARE-1.

Prerequisites

You have obtained an excise bond from the excise department and you have entered in the system.

Procedure

1. On the Bond/UT-1 Detail tab, enter the number of the excise bond that you want to cover the ARE-1 and the year in which it was issued.

2. Choose .

The system displays the bond details.

3. If you want to see which other ARE-1s the bond is already assigned to, choose .

Posting ARE-1s

Use

When you have created an ARE-1 and the excise officer has confirmed that all the details are correct, you can post the ARE-1.

You can still make any changes that you need to before you post it.

Procedure


Under Excise Regulations → Exports → Central Processing → Post ARE-1. 2. In the top line:

a. Select Post. b. Select ARE-1 Internal Document.

c. Enter the internal ARE-1 number and fiscal year and choose .

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3. On the Certification Dates tab, enter the date and time that the goods are being dispatched. 4. Save the ARE-1.

Result

The system:

� Assigns the ARE-1 an official ARE-1 number (see ARE Document Numbering) � Clears the excise duty from the bond's reservation amount and debits it to the bond (see Bond Balance)

You can no longer change the ARE-1. However, you can still reverse it, if need be. Otherwise, the next step is to update it.

Updating ARE-1s

Use

When the goods arrive at customs, the customs officer checks them against the excise invoice and the ARE-1. If there are any discrepancies in the quantity of the goods, he records them on the ARE-1. He also fills out Part B of the ARE-1 (Certification by the Customs Officer) and sends you three copies of the ARE-1, one in a sealed envelope.

When you receive the ARE-1, you update the dates in the ARE-1 in the system to match what the customs officer has written on the ARE-1.

Procedure


Under Excise Regulations → Exports → Central Processing → Update ARE-1. 2. In the top line:

a. Select Update. b. Select ARE-1 Internal Document.


3. On the Certification Dates tab, fill out the following dates as per the ARE-1:

� Arrived at Customs

� Countersigned by Customs

� Arrived Back

4. Enter any shortfalls that the customs officer has noted on the ARE-1. 5. Save the ARE-1.

Result

If the bond is a running bond and you have activated the fast credit function, the system credits the excise duty back to the running bond.

You must now send the ARE-1 to your local excise department.

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Entering Shortfalls in ARE-1s

Use

If, for any reason, the customs officer finds that the quantities of the goods are lower than you have stated on the excise invoice and the ARE-1, he amends the quantity on the ARE-1. You must then enter the shortfall in the ARE-1.

Since the whereabouts of the missing goods cannot be accounted for, they no longer qualify for exemption from excise duty. You must therefore pay the excise duty on the shortfall, plus interest, backdated to the date when you removed the goods from your premises.

Procedure

1. Choose the line item that you want to adjust.

2. In the detail data, on the Quantities tab, enter the amended quantity, and choose .

The system displays the shortfall in the Differential Qty field.

It calculates the interest due and displays it on the Utilization tab in the Interest Amount field.

3. On the Utilization tab, specify whether you want to pay the excise duty from register RG 23A, register RG 23C, or your PLA.

4. On the Document Details tab, enter the reason for the shortfall in the Reason Code field.

Result

When you save the ARE-1, the system:

� Generates a Part II entry in the registers that you have specified (see Excise Registers) � Creates an accounting document to debit the excise duty to the CENVAT reversal account and credit it to

the appropriate register accounts as follows (assuming, for example, that you want to pay the excise duty and interest from Register RG 23A and the PLA):

� Credits this excise duty back to the bond (see Bond Balance)

Reversing ARE-1s

Use

When you have posted an ARE-1, you can reverse it if necessary until such time as customs has countersigned it.

By reversing an ARE-1, you forego the exemption from paying the excise duty that was due on the materials

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when you removed them from your premises. Consequently, you must pay the excise duty plus interest (see Interest Calculation).

Procedure


Under Excise Regulations → Exports → Central Processing → Reverse ARE-1. 2. In the top line:

a. Select Reverse ARE-1. b. Select ARE-1 Internal Document.


3. On the Utilization tab, specify which excise registers you want to pay the excise duty and the interest from.

You can divide the amount payable between the different registers as you wish.

4. On the Document Details tab, enter the reason for reversing the ARE-1. 5. Save the ARE-1.

Result

The system:



� Credits this amount of excise duty back to the bond (see Bond Balance)

You can no longer change the ARE-1.

Sending ARE-1s to Excise Departments

Use

Once the customs officer has returned the ARE-1 to you, you send it to the excise department so that they can cross-check it against their original ARE-1.

Procedure



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a. Select Update ARE-1. b. Select ARE-1 Internal Document.


3. On the Certification Dates tab, fill out the Sent to Excise Dept field. 4. Save the ARE-1.

Result

The next step is to close the ARE-1.

Closing ARE-1s

Use

When the excise department sends you confirmation that the ARE-1 is correct, you record the date in the system. This closes the ARE-1.

Procedure





3. On the Certification Dates tab, fill out the Export Confirmed field. 4. Save the ARE-1.

Result

If the bond is a running bond, the system also credits the excise duty back to the bond, if it has not already done so (see Bond Balance).

The ARE-1 is now complete.

Pro Forma of Running Bond Account

Use

You use this report to prepare the statutory pro forma of running bond account, to be submitted monthly. It shows the following details for a single running bond:

� Its opening balance

� All of the ARE-1s that it has covered

� The duty debited from it when you posted the ARE-1s and the duty credited back to it once you closed the

ARE-1s

� The bond's current balance

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Movements → Exports Under Excise Regulations → Reports → Pro Forma of Running Bond Account.

Statement Regarding Export of Excisable Goods

Use

You use this report to prepare the statutory statement regarding export of excisable goods, to be submitted at least once a month to your local excise department. The report prints out the complete statement in a format acceptable to the excise departments.

Features


Movements → Exports Under Excise Regulations → Reports → Statement Regarding Export of Excisable Goods.

Selection

On the selection screen, specify which parts of the statement you want to prepare as follows:

Bond Summary Report

Use

You use this report to prepare a list of all your excise bonds. The list shows the basic information about each excise bond, and you can drill down to see which ARE-1s the bond has been assigned to.

Features


Movements → Exports Under Excise Regulations → Reports → Bond Summary.

Selection

Fill out the selection screen with the data for the bonds that you want to display.

Part Shows

I All stock removals without payment of duty

II All removals from previous quarters for which you have not yet received a confirmation of receipt from the customs office

III All stock removals that will exceed the export period by the end of the month

IV All removals that you have reversed

V A list of your bonds with their balances

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Output

The system displays a list of the bonds that meet the selection criteria. To see which ARE-1s a bond has covered,

choose .

Exports Under Claim for Rebate

Use

If you have not obtained an excise bond, you must pay any excise duty liable when removing goods from your premises for export. However, you can claim a rebate for the excise duty once you have completed the export if you fill out an ARE-1 to go with the export.

Activities

Customizing


Business Transactions → Exports Under Excise Regulations → Exports and … → Printouts of ARE-Documents.


In order to qualify for a rebate on the excise duty, all exports must be accompanied by the appropriate paperwork, including an ARE-1 document, and you must complete the export within the export period. To process and track these documents, use the ARE Documents functions, following the process described under ARE-1 Processing.

There is an ad-hoc report that you can use for tracking ARE-1s, Aging Analysis for ARE Documents.

ARE-1 Processing

Purpose This procedure describes how you process ARE-1s for exports under claim for rebate.

Prerequisites You have received a sales order from a customer located abroad. In the system, you have already created the delivery and the outgoing excise invoice. In the excise invoice, you have set the excise invoice type to Export Under Claim for Rebate.

Process Flow

The excise clerk creates an ARE-1.

He then calls the local excise department and asks them to send an excise officer to check the goods.

The excise officer comes and checks that the goods match what is on the ARE-1. He fills out Part A of the form (Certification by the Central Excise Office).

The clerk then posts the ARE-1 and prints out the requisite number of copies.

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The excise officer signs the ARE-1s and takes one copy with him.

The shipping department sends the goods to be exported, together with the excise invoice and the ARE-1.

Before the goods can leave the country, they have to go through the customs office, for example, at the airport or at the port.

When the goods arrive at customs, the customs officer checks whether the excise invoice and the ARE-1 match the goods.


He then fills out Part B of the ARE-1 (Certification by the Customs Officer) and sends it back to the excise clerk. One of the copies is in a sealed envelope.



If the customs officer noted a shortfall in the quantity of goods, the excise clerk enters the shortfall as well. Later, when you come to claim the rebate, you will not be able to claim back the excise duty on the shortfall.

The clerk sends the ARE-1 in the sealed envelope to the excise department.

The excise officer cross-checks this copy of the ARE-1 with his own copy. When he is satisfied that everything is correct, he sends the excise clerk a final confirmation.

When the excise clerk receives the confirmation, he closes the ARE-1.

The ARE-1 is now complete and you can apply for the rebate on the excise duty that you have paid.

Creating ARE-1s

Use

You create an ARE-1 when you want to export goods under claim for rebate.

Procedure


Under Excise Regulations → Exports → Central Processing → Create ARE-1. 2. In the top line:

a. Select Create ARE-1. b. Select Outgoing Excise Invoice.

c. Enter the excise invoice that the ARE-1 is for and choose .

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d. If the ARE-1 is to cover more than one excise invoice, repeat step (c) for each of them.

3. On the Addresses tab, enter the addresses of your local excise department and the customs department that will process the ARE-1.

Their addresses will be printed on the ARE-1. For more information, see Automatic Address Determination.





3. Save the ARE-1.

Result

The system:

� Creates the ARE-1 and assigns it an internal ARE-1 number (see ARE Document Numbering) � Sets the document status to In Process

The next step you have to carry out in the system is to post the ARE-1. If you need to, you can still cancel the ARE-1.

Changing ARE-1s

Use


� Which excise invoices are assigned to it � Which addresses are entered � Any long texts � Any package details

Procedure


Under Excise Regulations → Exports → Central Processing → Change ARE-1. 2. In the top line:




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Posting ARE-1s

Use

When you have created an ARE-1 and the excise officer has confirmed that all the details are correct, you can post the ARE-1.


Procedure


Under Excise Regulations → Exports → Central Processing → Post ARE-1. 2. In the top line:



3. On the Certification Dates tab, enter the date and time that the goods are being dispatched. 4. Save the ARE-1.

Result

The system assigns the ARE-1 an official ARE-1 number (see ARE Document Numbering).


Updating ARE-1s

Use

When the goods arrive at customs, the customs officer checks them against the excise invoice and the ARE-1. If there are any discrepancies in the quantity of the goods, he records them on the ARE-1. He also fills out Part B of the ARE-1 (Certification by the Customs Officer) and sends you three copies of the ARE-1, one in a sealed envelope.

When you receive the ARE-1, you update the dates in the ARE-1 in the system to match what the customs officer has written on the ARE-1.

Procedure





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3. On the Certification Dates tab, fill out the following dates as per the ARE-1:

� Arrived at Customs

� Countersigned by Customs

� Arrived Back

4. Enter any shortfalls that the customs officer has noted on the ARE-1. 5. Save the ARE-1.

Result

You must now send the ARE-1 to your local excise department.


Use

If, for any reason, the customs officer finds that the quantities of the goods are lower than you have stated on the excise invoice and the ARE-1, he amends the quantity on the ARE-1. You must then enter the shortfall in the ARE-1.

Later, when you come to claim the rebate, you will not be able to claim back the excise duty on the shortfall.

Procedure




3. On the Document Details tab, enter the reason for the shortfall in the Reason Code field.

Reversing ARE-1s

Use

When you have posted an ARE-1, you can reverse it if necessary until such time as customs has countersigned it.

Procedure


Under Excise Regulations → Exports → Central Processing → Reverse ARE-1. 2. In the top line:



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3. On the Document Details tab, enter the reason for reversing the ARE-1. 4. Save the ARE-1.

Result


Closing ARE-1s

Use

When the excise department sends you confirmation that the ARE-1 is correct, you record the date in the system. This closes the ARE-1.

Procedure





3. On the Certification Dates tab, fill out the Export Confirmed field. 4. Save the ARE-1.

Result


Deemed Exports

Use

You can ship deemed exports to any customers in possession of a deemed export license without paying any basic excise duty, but only if the goods are accompanied by an ARE-3 document.

Activities

Customizing


Business Transactions → Exports Under Excise Regulations → Deemed Exports and … → Printouts of ARE Documents.

Master Data

Enter your customers' deemed export licenses in the system.

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In order to qualify for an exemption from excise duty, all deemed exports must be accompanied by the appropriate paperwork, including an ARE-3 document, and you must complete the deemed export within the rewarehousing period. To process and track ARE-3s, use the ARE Documents functions, following the process described under ARE-3 Processing.

You can only issue an ARE-3 with reference to a customer's license. The system automatically keeps track of the license balance.

There are two ad-hoc reports that you can use for tracking licenses and ARE-3s: Deemed Export License Summary and Aging Analysis for ARE Documents.

Deemed Export License

Definition

A license issued by the excise authorities under which an exporter can procure goods from a manufacturer without payment of basic excise duty.

The license is not a blanket exemption. It only applies to purchases of specific quantity or value of specific goods from a specific vendor, for example, 20 personal computers from Computer World Pvt. Ltd.

Use

Master Data

When your customers obtain a deemed export license from the excise authorities, they send you a copy. You enter your customers' licenses in the system; the system numbers each license automatically.

If, later on, a customer gets an extension on the expiry date of the license from the excise authorities, you can enter it there as well. When a license is exhausted, you close it.


When you sell a customer some goods that are covered by a license, you create an ARE-3 to go with the goods shipment. In the ARE-3, you specify which license the goods are covered by. The system reduces the license balance accordingly.

When the license balance is exhausted, you can close it.

Reporting

You can keep track of your customers' licenses using the Excise Bonding License Summary.

License Numbering

Use

When you create a deemed export license, the system automatically assigns it an internal license number.

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Each license also has an official license number.

Activities

Customizing

Maintain the number range object for the internal license number in Customizing for Logistics – General, by

choosing Tax on Goods Movements → India → Tools → Number Ranges.

Master Data

When you enter a license, you enter the official license number manually. When you save the license, the system automatically assigns it an internal license number.

License Balances

Use Each deemed export license only covers a limited quantity of goods or goods to a limited value, depending on its quantification method.

Every time you post an ARE-3 against a license, the remaining quantity or value decreases automatically. The system thus keeps track of the license balances for you.

Features The excise authorities issue several different license types with different quantification methods. When you define the license types in the system (see Customizing below), you specify which quantification method each uses.

Activities

Customizing

Define the license types in Customizing for Logistics – General, by choosing Tax on Goods Movements →

India → Business Transactions → Exports Under Excise Regulations → Deemed Exports → Maintain License Types.

Master Data

When you enter a license in the system, you specify the license type and the quantity or value of the goods covered.

The license type controls which quantification method applies to the license.


When you post an ARE-3, the system automatically debits the value or quantity of the goods stated in the ARE-3 to the license. The license balance decreases accordingly.

If you reverse an ARE-3, the license balance does not go back up.

You can check the license balances at any time in the license master or in the Deemed Export License Summary.

License Validity

Use

Deemed export licenses are only valid for a limited period of time. The system ensures that you can only use licenses if they are valid, and allows you to extend their validity period if required.

Activities

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Master Data

When you enter a license, you enter the validity period as stated on the original document.

If a license expires and the excise authorities grant your customer an extension on the validity period, enter the extension date in the license master. Note that this field only appears once the license expires.

Otherwise, you close the license.


The system will not allow you to assign an invalid license to an ARE-3.

Processing Deemed Export Licenses


Taxes → Master Data → Deemed Export License.

ARE-3 Processing

Purpose This procedure describes how you process ARE-3s for deemed exports.

Prerequisites Your customer has supplied you with a copy of its deemed export license and you have entered the license in the system.

You have received a sales order from the customer for goods covered by this license. In the system, you have already created the delivery and the outgoing excise invoice. In the excise invoice, you have set the excise invoice type to Deemed Exports.

Process Flow


Create a license → Create The system assigns the license an internal license number and sets the license status to Active.

Change a license → Change You can only change a license if you have not already assigned it to an ARE-3.

Display a license → Display

Cancel a license → Cancel You can only cancel a license if you have not yet used it.

The system sets the status to Canceled.

Close a license → Close Close a license when all of the ARE-3s that it has covered are closed.

The system sets the status to Closed.

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The export clerk creates an ARE-3 and, when he is ready, posts it.

He also prints out the ARE-3 and encloses a copy with the delivery.

The shipping department sends the goods to the customer, together with the excise invoice and the ARE-3.

When the customer's warehouseman receives the goods, he checks whether the excise invoice and the ARE-3 match the goods.


He then fills out Part 2 of the ARE-3 (Certificate of Warehousing by the Consignee) and sends it back to the excise clerk.



If the warehouseman noted a shortfall in the quantity of goods, the excise clerk enters the shortfall as well. Since the whereabouts of the missing goods cannot be accounted for, they no longer qualify for exemption from basic excise duty. You must therefore pay the excise duty on the shortfall, plus interest, backdated to the date when you removed the goods from your premises. The clerk specifies which excise registers to pay the excise duty from.

The process is now complete.

Creating ARE-3s

Use

You create an ARE-3 when you want to send a customer a deemed export.

Procedure


Under Excise Regulations → Deemed Exports → Central Processing → Create ARE-3. 2. In the top line:

a. Select Create ARE-3 b. Select Outgoing Excise Invoice.

c. Enter the excise invoice that the ARE-3 is for and choose . d. If the ARE-3 is to cover more than one excise invoice, repeat step (c) for each of them.

3. Assign the deemed export license to the ARE-3. 4. On the Addresses tab, enter the address of your local excise department.

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Its address will be printed on the ARE-3. For more information, see Automatic Address Determination.





7. Save the ARE-3.

Result

The system creates the ARE-3 and assigns it an internal ARE-3 number (see ARE Document Numbering).

Changing ARE-3s

Use


� Which export licenses are assigned to the line items � Which excise invoices are assigned to it � Which addresses are entered � Any long texts � Any package details

Procedure


Under Excise Regulations → Deemed Exports → Central Processing → Change ARE-3. 2. In the top line:




Assigning Deemed Export Licenses to Line Items

Use

When you create an ARE-3, assign the line items the deemed export license that covers them.

Procedure

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1. In the item overview, select the line item that you want to assign the export license to. 2. On the License tab in the detail data, enter the internal license number and year.

Posting ARE-3s

Use

When you have created an ARE-3 and you are ready to ship the goods, you can post and print the ARE-3.


Procedure


Under Excise Regulations → Deemed Exports → Central Processing → Post ARE-3. 2. In the top line:



3. On the Certification Dates tab, enter the time that the date and time that the goods are being dispatched. 4. Save the document.

Result

The system:

� Assigns the ARE-3 an official ARE-3 number (see ARE Document Numbering) � Deducts the quantity or value of the goods from the license (see License Balances)


Updating ARE-3s

Use

When the goods arrive at the customer’s premises, the customer checks them against the excise invoice and the ARE-3. If there are any shortfalls in the quantity of the goods he records them on the ARE-3. The customer also fills out Part 2 of the ARE-3 (Certification of Warehousing by the Consignee) and sends you a copy.

When you receive the ARE-3, you update the ARE-3 in the system to match what the customer has written on the ARE-3.

Procedure


Under Excise Regulations → Deemed Exports → Central Processing → Update ARE-3. 2. In the top line:

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3. On the Certification Dates tab:

� Enter the Countersigned by Customer date as per the ARE-3.

� Enter the Arrived Back date.

4. Enter any shortfalls that the customer has noted on the ARE-3. 5. Save the ARE-3.

Result



Use

If, for any reason, your customer finds that the quantities of the goods are lower than you have stated on the excise invoice and the ARE-3, he enters the shortfall on the ARE-3. You must then enter the shortfall in the ARE-3.

Since the whereabouts of the missing goods cannot be accounted for, they no longer qualify for exemption from excise duty. You must therefore pay the excise duty on the shortfall, plus interest, backdated to the date when you removed the goods from your premises.

Procedure




It calculates the interest due and displays it on the Utilization tab in the Interest Amount field.

3. On the Utilization tab, specify whether you want to pay the excise duty from register RG 23A, register RG 23C, or your PLA.

4. On the Document Details tab, enter the reason for the quantity change in the Reason Code field.

Result

When you save the ARE-3, the system:



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Reversing ARE-3s

Use

When you have posted an ARE-3, you can reverse it if necessary until such time as you enter the rewarehousing date.

By reversing an ARE-3, you forego the exemption from paying the excise duty that was due on the materials when you removed them from your premises. Consequently, you must pay the excise duty plus interest (see Interest Calculation).

Procedure


Under Excise Regulations → Deemed Exports → Central Processing → Reverse ARE-3. 2. In the top line:



3. On the Utilization tab, specify which excise registers you want to pay the excise duty and the interest from.

You can divide the amount payable between the different registers as you wish.

4. On the Document Details tab, enter the reason for reversing the ARE-3. 5. Save the document.

Result

The system:


the appropriate register accounts as follows (assuming, for example, that you want to pay the excise duty and the interest from Register RG 23A and the PLA):

� Does not reinstate the value or quantity of the goods to the license

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Deemed Export License Summary

Use

You use this report to prepare a summary of the deemed export licenses that you have entered in your system.

Features


Movements → Excise Bonding → Reports → Deemed Export License Summary.

Selection

Enter selection criteria as required. If you want to see which ARE-3s the licenses have been used for, select Display ARE-3s Referred To.

Output

For each license, the list shows the header data, the materials covered by the license, and the license balance.

If you selected Display ARE-3s Referred To, the list also shows the ARE-3s assigned to each license. If the list shows an ARE-3 without an official ARE-3 number, that means that the ARE-3 has only been created and not yet posted.

ARE Documents

Use

This function is for use by excise clerks and excise supervisors, so that they can create and process ARE-1s and ARE-3s used to execute exports and deemed exports.

The following documentation describes the functions common to all types of exports under excise regulations. For information about the individual procedures involved, see Exports Under Bond, Exports Under Claim for Rebate, and Deemed Exports.

To access the ARE Documents function, from the SAP Easy Access screen, choose Indirect Taxes →

Sales/Outbound Movements → Exports Under Excise Regulations → …. There are several different transactions under this menu path. For more information about the different transactions available, see Transaction Configuration.

Integration

This function allows you to create ARE documents using outgoing excise invoices as a reference document, which in turn you create on the basis of deliveries. As such it is integrated with Sales and Distribution (SD) and Materials Management (MM).

Any entries that the system makes in relation to an ARE document, in Part II of the excise registers RG 23 A and C, are also shown in the transaction. It is thus integrated with Financial Accounting (FI).

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Features

The screen consists of the following areas:

Top Line

This is where you specify what document you want to process. When you create an ARE document, you specify the reference document in this area. When you process an ARE document that you have already created, you enter the ARE document number.

Header Data

This area consists of four tabs, each with information that relates to the whole of the excise document.

Tab Use

Document Details Basic header data, such as the internal and official ARE numbers and the document status.

Total Duties Total amounts of basic excise duty in the ARE document and any changes made by customs (ARE-1s) or the customer (ARE-3s)

Certification Dates Various dates used to track the progress of the ARE document.

Bond/UT-1 Detail In exports under bond, shows which bond the export is covered by.

This tab is only shown for exports under bond.

Excise Invoice Summary

The excise invoices that the ARE document covers.

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Item Overview

This area lists all of the items in the excise invoice. To process an item, you click the item number and process it in the detail data , but you process the items in the detail data area.

Detail Data

This area consists of seven tabs, each with information about a particular item.

Transaction Configuration

Use You can execute the ARE Documents function using different transaction codes. Each transaction code controls how users can process ARE documents and which reference documents they can use.

Features The standard system comes with one central processing transaction and three individual processing transactions for each type of ARE document:

• The central processing transactions allow users to carry out all functions on the ARE document and are suited to a system administrator, for example.

Addresses Shows the addresses of the local excise department and the customs office that is handling the ARE document.

Additional Data Fields for any additional information that you might want to enter, including various long texts to be printed on the ARE document.

Part II Any entries in Part II of the excise registers RG 23A, RG 23C, or PLA made as a result of your updating the quantities in the ARE document.

Note that this tab is not displayed if there are no Part II entries.

Tab Use

Item Basic information about the material itself.

Quantities Information the quantity of goods in the excise invoice, and how much of this quantity have entries in Parts I and II of the excise registers.

Duty Rates The rates of excise duty on the item.

Duty Values The excise duty on the item, and how much of it has already been credited to the CENVAT accounts.

License The license that this item is covered by (deemed exports only).

Package Details Any information about the packages that needs to be printed on the ARE document.

Reference Documents

The other SAP documents associated with the item.

Additional Data Fields for any additional information that you might want to enter, this time at item level.

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• The individual processing transactions restrict the users to specific processing modes only (for example, creating and displaying ARE documents, or updating and displaying ARE documents).

You can assign these transactions to excise clerks or supervisors.

For a list of the transaction codes provided, see Transaction Codes.

Activities

Customizing

If the delivered settings do not meet your requirements, you can change them in Customizing for Logistics –

General, by choosing Tax on Goods Movements → India → Business Transactions → Exports Under Excise

Regulations → Transaction Configuration.

ARE Document Numbering

Use In the system, each ARE document has two numbers: an internal number, which is the number that the system uses to identify the ARE document, and an official number, which corresponds to the serial numbers assigned to you by the excise department for the ARE document forms.

Activities

Customizing

To activate internal numbering, maintain the number range object J_1IINTNUM in Customizing for Logistics –

General, by choosing Tax on Goods Movements → India → Tools → Number Ranges.

To activate official numbering, maintain the number range object J_1IARE1 for ARE-1s, and J_1IARE3 for ARE-3s. Create a separate number range for each series group.


When you create an ARE document, the system automatically assigns it an internal document number. The system only assigns the ARE document an official number when you post it. Both numbers are displayed on the Doc. Details tab.

You cannot change either of the numbers manually.

Automatic Address Determination

Use

When you print ARE documents, they must show the address of your local excise department and the customs department that will be handling the export.

Activities

Customizing

Enter the name and address of every excise department and customs department that you have dealings with in

Customizing for Logistics – General, by choosing Tax on Goods Movements → India → Master Data → Maintain Postal Addresses.

Define a default local excise department address for each series group, in Customizing for Logistics – General, by

choosing Tax on Goods Movements → India → Master Data → Maintain Series Groups.

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When you create an ARE document, the system automatically enters the address of the local excise department that you have assigned to the series group. The address data is shown on the Addresses tab.

You can change it if you want to.

Long Texts

Use

The forms that ARE-1s and ARE-3s are printed on contain spaces for various pieces of information, for example, the mode of transport or the export seal number. When you create an ARE document, you can enter this information using the long text function and it will be printed at the appropriate positions.

Activities

Customizing

Country Version India comes with long texts already customized to go with the ARE-1 and ARE-3 forms. However, if you need to, you can define other long texts in Customizing for Logistics – General, by choosing Tax

on Goods Movements → India → Tools → Long Texts.


When you create an ARE document and you want to enter a long text for it, on the Additional Data tab, choose

Long Text.

In the dialog box, double-click the sort of long text that you want to enter, and type the text in the field next to it.

When you print out the document, the texts appear at the appropriate positions.

Printouts of ARE Documents

Use

You can print out ARE-1s or ARE-3s on blank A4 paper. The system prints out the entire form with the details filled in from the ARE that you have created. Since multiple copies are required of each ARE document, the system automatically prints out the number of copies needed.

Features

Country Version India comes with all the settings you need to print out ARE-1s and ARE-3s in the appropriate format. Two SAPscript forms are provided, one for ARE-1s and one for ARE-3s. These forms use the same printing program and output type. The output type is J1IB.

Activities

Customizing

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Check the output type settings provided in Customizing for Logistics – General, by choosing Tax on Goods

Movements → India → Business Transactions → Excise Bonding → Exports Under Excise Regulations → Printouts of ARE Documents.

Assign the output type to the ARE-1s and ARE-3s, in Customizing for Logistics – General, by choosing Tax on

Goods Movements → India → Business Transactions → Excise Bonding → Exports Under Excise Regulations →

Make Settings for ARE-1 Procedure and … → Deemed Exports → Make Settings for ARE-3 Procedure.

In the same activities, specify how many copies of each ARE document you want the system to print.


There are two ways of printing a document, as follows:

� When you post an ARE, select Print ARE Document on the Document Details tab.

Then, when you save the ARE, the system prints out the number of copies that you have specified.

� When you display an ARE, choose .

Note that this function is only available in display mode.

Export Periods and Rewarehousing Periods

Use

Exports under bond must be completed within the export period defined by the excise authorities, otherwise you no longer qualify for the exemption on the basic excise duty. Exports under claim for rebate must also be completed within this time or you will not be able to reclaim the duty. Similarly, deemed exports must also be completed within the allotted rewarehousing period.

The system keeps track of these periods for you automatically.

Activities

Customizing

Enter the export period in Customizing for Logistics – General, by choosing Tax on Goods Movements → India →

Business Transactions → Exports Under Excise Regulations → Exports.

Enter the rewarehousing period in Customizing for Logistics – General, by choosing Tax on Goods Movements →

India → Business Transactions → Exports Under Excise Regulations → Deemed Exports.


If an ARE-1 or ARE-3 reaches the end of the period without being closed, you can apply to the excise department for an extension.

� If the extension is granted, enter the extension date in the ARE document (see Extending Export Periods and Rewarehousing Periods).

� If not, you must repay the excise duty that you posted to the CENVAT account for the goods. To do so,

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reverse the ARE-1 or reverse the ARE-3.

You can track which AREs are coming to the end of their export or rewarehousing periods using the Aging Analysis for ARE Documents.

Extending Export Periods and Rewarehousing Periods

Use

If you have not closed an ARE document within the prescribed export period or rewarehousing period and you have obtained an extension from the excise department, you can enter the new date in the document.

Procedure


Under Excise Regulations → Exports or Deemed Exports → Central Processing → Update ARE-1 or Update ARE-3.

2. In the top line: a. Select Update. b. Select ARE-1 Internal Document or ARE-3 Internal Document.

c. Enter the internal ARE document number and choose . 3. On the Certification Dates tab, fill out the Extended Until field.

This field only appears once an ARE document exceeds the export period or rewarehousing period.

4. Save the document.

Result

Once you have entered the extension date, you can continue processing the ARE document as normal.

Interest Calculation

Use

Whenever you have to pay the excise duty originally exempted by an ARE document, you also have to pay interest on that amount, backdated to the date on which you removed the goods from your premises.

The system calculates the amount of interest due automatically.

Features

Interest is due whenever you reverse an ARE document (for example, when an ARE-1 exceeds the export period and the excise authorities do not grant you an extension).

It is also due when a customs officer updates the quantity of goods on the ARE-1, or a customer updates the quantity of goods on an ARE-3.

The applicable interest rates are announced by the excise authorities.

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Activities

Customizing

Maintain the interest rates in Customizing for Logistics – General, by choosing Tax on Goods Movements →

India → Business Transactions → Exports Under Excise Regulations → Exports → Make Settings for ARE-1

Procedure and … → Deemed Exports → Make Settings for ARE-3 Procedure.


The system automatically calculates interest when:

� You enter shortfalls in ARE-1s or enter shortfalls in ARE-3s � You reverse an ARE-1 or reverse an ARE-3

You can overwrite the excise duty and interest that the system proposes.

Adding Excise Invoices to AREs

Use

If you have already created an ARE document, you can still add additional excises to it until such time as you post it.

Procedure

1. On the Excise Invoice Summary tab, enter the excise invoice number and year in the Additional Excise Invoices field.

2. Choose .

Removing Excise Invoices from AREs

Use

If you have assigned an excise invoice to an ARE document and you wish to remove it, you can do so until such time as you have posted it.

Procedure

1. On the Excise Invoice Summary tab, enter the excise invoice number and year in the Additional Excise Invoices field.

2. Choose .

Canceling AREs

Use

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If you have already created an ARE document but not yet posted it, you can cancel it if you need to.

Procedure


Under Excise Regulations → Exports or Deemed Exports → Central Processing → Cancel ARE-1 or Cancel ARE-3.

2. In the top line: a. Select Cancel. b. Select ARE-1 Internal Document or ARE-3 Internal Document.

c. Enter the internal ARE number and choose . 3. Save the document.

Aging Analysis for ARE Documents

Use

You use this report to prepare a list of all ARE documents by their status. It allows you to see which documents need to be processed within a certain amount of time, for example, which ARE-1s are approaching the end of their export period and need to be extended.

Features


Movements → Exports Under Excise Regulations → Reports → Aging Analysis for ARE Documents.

Selection

1. Enter data as follows: a. In the Documents field, enter the status of the documents that you want to see. b. Then either enter a date range or enter a period.

The period can refer to the next so many days, or the past so many days, depending on what status you have selected.

2. Choose .

Output

Each document is assigned a status as follows:

� : Activity is overdue

� : Activity is due today

� : Activity has been completed

The list is formatted using the SAP List Viewer: see this documentation for more information about navigating and formatting options within the list.

Transaction Codes

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Form Tracking

Use

You use this function to record and monitor forms relating to tax concessions. You can record the forms that your

Transaction Function

J1IA101 Create, change, update, cancel, display ARE-1

J1IA102 Create, change, display ARE-1

J1IA103 Update, display ARE-1

J1IA104 Cancel, display ARE-1

J1IA301 Create, change, update, cancel, display ARE-3

J1IA302 Create, change, display ARE-3

J1IA303 Update, display ARE-3

J1IA304 Cancel, display ARE-3

J1IBN01 Create bond

J1IBN02 Change bond

J1IBN03 Display bond

J1IBN04 Cancel bond

J1IBN05 Close bond

J1ILIC01 Create license

J1ILIC02 Change license

J1ILIC03 Display license

J1ILIC04 Cancel license

J1ILIC05 Close license

J1IANX18 Pro Forma of Running Bond Account

J1IANX19 Statement Regarding Export of Excisable Goods

J1IARE_AGE Aging Analysis for ARE Documents

J1IBONSUM Bond Summary Report

J1ILICSUM License Summary Report

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customers send you against their sales orders, and those that you send to your vendors against your purchase orders.

You can also use these functions for monitoring other routine activities, for example, when you transfer money to your personal ledger account (PLA) using a TR6 challan.

Features

Forms for concessional sales tax must be submitted by the buyer after the goods have been delivered or after it has paid the invoice. In the case of interstate concessional sales tax rate sales, the concessional rate is granted against the issue of C-forms.

Exemption from excise duty may be granted by the excise authorities under certain circumstances, for example, on exports or deemed exports. In such cases, the buyer has to produce certain statutory forms to claim concessional rates of excise duty or exemptions. The exporter has to provide the vendor with proof of export (form AR3A).

If the buyer is unable to furnish the certificate at the appropriate time, material supply should be at the normal rate of sales tax or excise duty.

Activities

To access the form tracking function, from the SAP Easy Access screen, choose Indirect Taxes → Forms

Tracking → Create/Change/Display.

CENVAT Adjustment Postings

Use

You use these functions if you need to make an adjustment posting to any of your CENVAT accounts. You can make adjustment postings to account for:

� Scrap � Materials that you have not used in production � Additional excise paid by vendors � Money that you have transferred to your personal ledger account � Other transactions

You can also use this function to cancel excise invoices.

Features

Each of the different types of adjustment postings are documented separately. However, they all work on the same principle, as follows.

Reference Document

On the initial screen of the transaction, you specify the reference document, that is, the document which the adjustment posting is to refer to – either an internal document, such as a material document or a subcontracting challan – or an external document, such as an incoming excise invoice.

You also specify which registers are affected by the posting. In many cases, the adjustment will have to be

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remitted to the authorities on a fortnightly basis. The adjustment will then be included when you run the Remittance of Excise Duty Fortnightly report. If the adjustment has to be remitted immediately, you specify which register is affected.

Excise Details

When you proceed to the detail screen, the system automatically shows the line items from the reference document, if it is an internal document. You specify how much excise duty is to be adjusted and which CENVAT accounts the adjustment posting is to be made to.

When you edit the excise details, there are a number of functions that are available, depending on the type of adjustment posting:

� Assigning excise invoice to line items � Specifying which G/L accounts are to be adjusted � Displaying balances of CENVAT accounts

When you save your changes, the system creates an accounting document to make the appropriate postings.

Making Adjustment Postings for Scrap

Use

You follow this procedure if you have scrapped a material and want to reverse the excise duty debited to your CENVAT account.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → Matl write-off. 2. Enter data as required, including:

� Document number

Enter the number of the document that you used to scrap the material.

� CENVAT account selection group box

Specify which account is affected by the adjustment posting is for. If the posting does not have to be remitted immediately, select Fortnightly payment.

3. Choose .

The system displays the information from the material document.

4. Adjust the posting date as necessary. 5. Adjust the excise duty for each line item either:

� Manually

� By assigning the line item to an excise invoice

6. Specify which G/L accounts are to be posted to.

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7. Save the adjustment posting.

Making Adjustment Postings for Materials Not Used in Production

Use

You follow this procedure if you have not used a material in the production process and want to reverse the excise duty debited to your CENVAT account.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → Matl non-prod. 2. Enter data as required, including:

� Document number

Enter the number of the material document that the adjustment posting is to refer to.



3. Choose .


4. Adjust the posting date as necessary. 5. Adjust the excise duty for each line item either:

� Manually

� By assigning the line item to an excise invoice

6. Specify which G/L accounts are to be posted to. 7. Save the adjustment posting.

Making Adjustment Postings for Additional Excise Paid by Vendors

Use

You follow this procedure if a vendor has increased the amount of excise duty that it originally charged you and you want to debit the difference to your CENVAT account.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → Additional excise.

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2. Enter data as required.

In the Document number field, enter then number of the document sent to you by the vendor.

3. Choose . 4. Adjust the posting date as necessary. 5. Enter the amount of excise duty in either of the following ways:

� To enter line items for different materials and the excise duty accordingly, choose and enter the line items in the table.

� To enter the excise duty only, choose and enter the excise duty in the totals fields at the foot of the screen.

6. If the duty qualifies as countervailing duty (CVD):

a. Select CVD applicable. b. Enter the CVD amount in the BED amount field.


Making Adjustment Postings for Money Transferred to PLA

Use

You follow this procedure to make an adjustment posting when you transfer money to your personal ledger account (PLA).

Prerequisites

You have already transferred the money to your PLA at the bank, using a TR6 challan, and have posted the corresponding accounting document.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → TR6 challan. 2. Enter data as required, including the document number.

You can enter either the challan number or the number of the accounting document.

3. Choose .

If you entered the accounting document number, the system displays the information from it.

4. Enter the amounts against the accounts that you require. 5. Save the adjustment posting.

Making Adjustment Postings for Other Transactions

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Use

You follow this procedure if you want to make an adjustment posting that does not fall into any of the other categories of adjustment offered by this function. You can only use an external document as your reference document.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes → Excise JV → Create → Other adj. 2. Enter data as required, including:

� Document number

Enter the number of the external document that you want to refer to.



3. Choose .


4. Adjust the posting date as necessary. 5. Enter the amount of excise duty in either of the following ways:

� To enter line items for different materials and the excise duty accordingly, choose and enter the line items in the table.

� To enter the excise duty only, choose and enter the excise duty in the totals fields at the foot of the screen.


Assigning Excise Invoices to Line Items

Use

When you make an adjustment posting, you follow this procedure if you want to specify the original excise invoice associated with a line item.

Procedure

1. Select the line item that you want and choose Get excise invoice.

The system displays a list of all the excise invoices that you have posted from this vendor for this particular material.

2. Select the excise invoice that you want and choose .

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The system:

� Enters the excise invoice document number in the Ref. doc. field (Reference document).

� Calculates how much of the excise duty from the excise invoice should be apportioned to the line item and enters it in the excise duty fields.

If you then overwrite these amounts, you should also overwrite the reference document number with an explanatory text, since there is no point in maintaining the link to the reference document anymore.

You have a line item with ten plates of glass that you have broken and are to be scrapped. You have three excise invoices from the same vendor to choose from. You pick one for 20 plates of glass with BED at INR 200. The system automatically apportions INR 100 to the line item that is to be reversed.

Specifying Which CENVAT Accounts to Adjust

Use

When you make an adjustment posting, you have to specify which CENVAT accounts are to be adjusted.

Prerequisites

You have specified whether you want the users to be able to add extra debit accounts (see below), in

Customizing for Logistics – General, by choosing Taxes on Goods Movements → India → Basic Settings → Maintain Company Codes.

Procedure

1. Choose Determine G/L accounts.

A dialog box appears that shows how much will be posted to which G/L accounts. The accounts that are displayed depend on the excise group and the CENVAT account that you entered on the selection screen.

2. Add another account, if you need to, and adjust the other postings so that the credits and debits match. 3. Enter a business area and cost center, if necessary.

4. To close the dialog box, choose .

Displaying CENVAT Account Balances

To display the balances of your CENVAT accounts, choose Balances.

The system displays the balances only of the CENVAT accounts that are affected by your G/L postings.

Treasury and Risk Management – India (TRM)

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Purpose

In India, you are required to calculate and post withholding tax during the borrowings operations in TRM.

In SAP ECC you use the Treasury and Risk Management solution to withhold this tax automatically.

The TRM withholding tax function for India is available for product types:

� Money market

� Securities

The performance of one of these functions has as result that the tax transaction is part of TRM transactions.

In the case of a tax rate change, the new tax rate is considered for the withholding tax calculation.

Integration

Prerequisite for the TRM withholding tax customizing is a complete extended withholding tax customizing in Financial Accounting.

The specific functions for India are integrated into the Financial Accounting process and calculate the withholding tax before posting the tax to the corresponding customer account.

For more information about the Customizing settings in FI see Extended Withholding Tax.

Features

Customizing

You must carry out the Customizing settings for extended withholding tax.

You carry out the customizing actions to generate withholding tax in TRM with the maintenance view TRXV_WT_ASSIGN.

You can use this view to control for which flows withholding tax is calculated and posted. You can assign flows only to certain product types, financial transaction types, business partners, securities accounts, securities account groups or portfolios.

For more information, see Overview.

In addition you must carry out the settings as described in Customizing.

Business Transactions

You record money market and securities transactions following the standard procedure.

The system automatically calculates withholding tax for India when you save the transaction.

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If, for example, the interest rate has changed during settlement, the system recalculates withholding tax.

Reporting

You can prepare your report and print it: you use for this the cash flow reporting program.

Constraints

This component is not used for areas:

• CML (Loans)

• Micro-hedging for recording the underlyings for foreign exchange (forex) contracts

Customizing

Implementation Consideration

To customize Treasury and Risk Management for use in India you carry out the generic Customizing activities for withholding tax using the information provided in the following.

Additionally, you carry out the Customizing activities that relate to functions used only in India.

Settings

You must maintain every update type in the Update Type Tax Base column of the maintenance view, which should generate a withholding tax flow.

You create this withholding tax flow with a flow type maintained in the Update Type column.

Since it is very important to correctly maintain this table, we recommend that you read the F1 Help of the fields of this maintenance view.

Business Transactions

Use

You record money market and securities transactions following the standard procedure.

In addition, when you save this transaction, the system automatically calculates withholding tax.

During settlement, the system recalculates withholding tax.

Calculating Withholding Tax and Posting in TRM

Purpose You can use this process to execute withholding tax calculation with the standard procedure and by posting the tax relevant flows to customer for the corresponding business partner.

The calculation and posting of withholding tax in TRM is possible for product types Money Market (using the transaction for creating fixed-term deposit) and Securities (using the transaction for creating security transactions).

Prerequisites

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The withholding tax calculation is dependent on the withholding tax type and the withholding tax code which are defined in the Financial Accounting Global Settings, customized under topic Extended Withholding Tax.

To calculate withholding tax in TRM, the flow types for which withholding tax should be calculated and posted must be defined in the customizing table TRXV_WT_ASSIGN.

For every item in this table the withholding tax type and the withholding tax code have to be defined.

Result The withholding tax flow is now calculated, posted and is part of the TRM transaction.

Withholding Tax Calculation in Contracts

Use

If you want to perform a withholding tax calculation and post it in Treasury and Risk Management you post tax-relevant flows.

The operator posts the tax-relevant flows involving the customer account for the corresponding business partner.

Procedure In the contract you define the flow types for which withholding tax must be calculated and posted.

You assign a contract to a customer using the Control Data indicator on the Payment details tab page in the contract. Only then the system calculates and posts the withholding tax.

Maintain the fields “Business Place” and “Section Code” in a contract. In TRM, both fields can be maintained in the box “Position indicator” of a transaction. To access this transaction on the SAP Easy Access screen choose Create fixed-term deposit → Environment → Posting Indicator.

Result You have calculated the withholding tax and saved it in the database.

Contract Processing

Use

The business place and section code fields are used for the withholding tax process in India.

In TRM, you can enter data for both fields in the Position Indicator of a transaction.

On the SAP Easy Access screen, choose Environment → Posting Indicator.

The integration to Financial Accounting guarantees that the values of these fields are also transferred to FI and are then part of the FI accounting document.

Example The mapping of registration data, reporting, payment and due dates are based on these fields.

Calculating Withholding Tax on Interest Accruals

Use This function enables you to define the posting on accruals and deferrals of expenses and revenues in Treasury. To perform these functions, you use the corresponding transaction. On the SAP Easy Access screen, choose for Money Market → Accounting → Financial Supply Chain Management → Treasury and Risk Management → Transaction Manager → Money Market → Accounting → Accrual/Deferral. Choose for Securities, instead: Accounting → Financial Supply Chain Management → Treasury and Risk

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Management → Transaction Manager → Securities → Accounting → Interest Accrual/Deferral.

For more information about processing of interest accruals, see Accrual/Deferral.

For the TRM India withholding tax function only the difference procedure is possible as an accrual/deferral procedure.

Prerequisites To generate a withholding tax flow for an accrual, it is necessary to maintain the accrual update type in the corresponding Customizing table.

Features This program makes accruals or deferrals of expenses and revenues resulting from Treasury deals, and allocates revenue and expenditure items to the proper account periods.

This program performs the following functions:

� Calculates the amount to be accrued or deferred for the flows concerned

� Creates the corresponding accrual or deferral flows

� Posts the items immediately in financial accounting, if required.

Calculating Withholding Tax Calculation for Brokerage Amounts

Use If withholding tax is raised on brokerage you can create brokerage flows on tab page Other flows of the transaction for brokerage amounts.

To generate withholding tax for a brokerage flow, you must maintain the brokerage update type, in the Update Type Tax Base column of the Customizing view..

Example You can use the following update type:

� SE3001: Brokerage capitalized

Treasury: Post Flows

Use You use this report to check and control the postings and transferring transactions you have carried out.

Posting and Transferring of Flows

Use You use this function to generate documents to Financial Accounting in Treasury.

This is possible with transaction Settle Fixed-Term Deposit and Program Treasury: Post Flows.

Features The report performs following activities:

1. The program finds the corresponding posting details for each flow in account determination.

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2. The document is prepared and transferred to Financial Accounting.

3. The calculated withholding tax amounts or flows are processed, transferred to Financial Accounting, and posted in a single FI document.

4. The list output displays the selected transactions with the withholding taxes calculated.

Activities You can use the test run to check whether these steps can be carried out correctly, without Financial Accounting to be updated.

After a test run and during a productive run instead, the withholding tax information is stored in the contract, transferred to Financial Accounting, and posted in a single FI document.

Roles

The following documents describe the roles delivered with Country Version India (CIN). For more information

about roles in general, see Creating Activity Groups ("activity group" is the old term for "role").

India Localization

Technical name: SAP_CIN

Tasks

This role covers all of the tasks associated with Country Version India (CIN), including Customizing, day-to-day operations, and reporting.

This is the role that all the menu paths given in this documentation are based on.

CIN Customizing and Master Data Maintenance

Technical name: SAP_CIN_SUPER_USER

Tasks

This role covers all the Customizing activities relating to Country Version India (CIN), in all applications. It also covers the maintenance of excise master data.

Excise Manager (Materials Management)

Technical name: SAP_CIN_MM_MANAGER

Tasks

This role covers all administrative tasks in Country Version India (CIN) that relate to excise duty in the areas of

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procurement and subcontracting. It includes Customizing activities; all day-to-day operations; and reporting.

Activities in Materials Management (MM)

In Customizing and master data, the Excise Manager is authorized to:

� Work with the CIN Implementation Guide (IMG)

� Use the health check tool

� Define number ranges for excise invoices

� Maintain excise master data

� Make retrospective price amendments

In your day-to-day operations, this role allows you to:

� Capture, change, display, post, and cancel incoming excise invoices

� Capture excise invoices at depots

� Complete subcontracting challans and perform quantity reconciliation

� Post excise invoice journal vouchers

� Track forms

Activities in Financial Accounting (FI)

The Excise Manager can:

� Create the excise registers

� Transfer outstanding CENVAT credit on capital goods to the appropriate CENVAT accounts

Excise Supervisor (Materials Management)

Technical name: SAP_CIN_MM_SUPERVISOR

Tasks

This role covers most of the tasks in Country Version India (CIN) that relate to excise duty in the areas of procurement and subcontracting. It includes all day-to-day operations and reporting, but only one Customizing activity.


In Customizing and master data, the Excise Supervisor is authorized to:

� Define number ranges for excise invoices




� Capture, change, display, post, and cancel incoming excise invoices

� Capture excise invoices at depots

� Execute all activities relating to subcontracting challans

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� Post excise invoice journal vouchers

� Track forms


The Excise Supervisor can:

� Create the excise registers

� Transfer outstanding CENVAT credit on capital goods to the appropriate CENVAT accounts

Excise Clerk (Materials Management)

Technical name: SAP_CIN_MM_CLERK

Tasks

This role covers the tasks relating to capturing incoming excise invoices.


The Excise Clerk can:

� Capture excise invoices (of all types)

� Track forms

Excise Manager (Sales and Distribution)

Technical name: SAP_CIN_SD_MANAGER

Tasks

This role covers the administrative tasks in Country Version India (CIN) that relate to excise duty in the area of sales. It includes all Customizing activities; day-to-day operations; and reporting.

Activities in Sales and Distribution (SD)

In Customizing and master data, the Excise Manager is authorized to:






� Create and verify outgoing excise invoices for other movements

� Create excise invoices in batches

� Post excise journal vouchers

� Print excise invoices

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� Track forms

In reporting, this role also allows you to:

� Remit excise duty using the fortnightly utilization program

� Print 57AE returns

Excise Supervisor (Sales and Distribution)

Technical name: SAP_CIN_SD_SUPERVISOR

Tasks

This role covers the tasks in Country Version India (CIN) that relate to excise duty in the sales area. It includes the maintenance of master data; day-to-day operations; and reporting. It does not, however, include Customizing.


In master data, the Excise Supervisor is authorized to:




� Create and verify outgoing excise invoices for other movements

� Create excise invoices in batches

� Post excise journal vouchers


� Track forms

In reporting, this role also allows you to:

� Remit excise duty using the fortnightly utilization program

� Print 57AE returns

Excise Clerk (Sales and Distribution)

Technical name: SAP_CIN_SD_CLERK

Tasks

This role covers the tasks relating to the creation of excise invoices.


The Excise Clerk can:

� Create excise invoices for other movements

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� Track forms

Subcontracting Clerk

Technical name: SAP_CIN_SUBCONTRACTING_CLERK

Tasks

The Subcontracting Clerk is authorized to create, change, and display subcontracting challans.

Bonding Clerk

Technical name: SAP_CIN_BONDING_CLERK

Tasks

This role covers all tasks relating to exports under excise regulations.


The Bonding Clerk can:

� Create, change, display, and cancel excise bonds and deemed export licenses

� Create, change, update, display, and cancel ARE documents

� Execute all the associated reports

TDS Manager

Technical name: SAP_CIN_TDS_MANAGER

Tasks

This role covers all the activities in Country Version India (CIN) that relate to tax deducted at source (TDS). It includes all Customizing activities, day-to-day operations, and reporting.


In Customizing, the TDS Manager is authorized to:



In day-to-day operations, you can:

� Carry out all the activities relating to the remittance of tax withholdings

� Make adjustment postings

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� Print and cancel TDS certificates for vendors

� Post and clear withholding tax on clearing accounts (Extended Withholding Tax only)

� Print TDS certificates for customers

In reporting, the TDS Manager can:

� Prepare annual returns for TDS (Classic TDS and Extended Withholding Tax)

� Prepare MIS report (Extended Withholding Tax)

TDS Supervisor

Technical name: SAP_CIN_TDS_SUPERVISOR

Tasks

This role covers the administrative activities in Country Version India (CIN) that relate to tax deducted at source (TDS). It includes all day-to-day operations and reporting, but not Customizing.


In day-to-day operations, the TDS Supervisor can:

� Carry out all the activities relating to the remittance of tax withholdings

� Make adjustment postings

� Print and cancel TDS certificates for vendors

� Post and clear withholding tax on clearing accounts (extended withholding tax only)

� Print TDS certificates for customers

In reporting, you can:

� Prepare annual returns for TDS (Classic TDS and Extended Withholding Tax)

� Prepare MIS report (Extended Withholding Tax)

� Archive TDS documents

TDS Clerk

Technical name: SAP_CIN_TDS_CLERK

Tasks

This role covers the day-to-day operations relating to tax deducted at source (TDS).


The TDS Clerk can:

� Carry out all the activities relating to the remittance of tax withholdings (Classic TDS and extended withholding tax)

� Post and clear withholding tax on clearing accounts (extended withholding tax only)

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Register Maintenance Clerk

Technical name: SAP_CIN_REGISTER_CLERK

Tasks

This role covers all the activities relating to the preparation of excise and sales tax registers.

Data Archiving

Purpose This component archives the data in tables pertaining to Country Version India. For generic information on data

archiving, see Overview of the Archiving Workbench.

Implementation Considerations You must archive the standard tables before archiving the Country Version India tables. Archiving of Country Version India related data may lead to an inconsistency in the system, if the standard tables are not archived.

Features • The data archiving tool for Country Version India:

� Writes the data to be archived into info catalogs.

� Deletes the data from the active database.

� Reads and displays the data in the info catalogs

● The data archiving tool archives all the Country Version India data for the excise group for a period.

● The data archiving tool for Country Version India archives the following tables:

Country Version India Archiving Tables

Table Name Description

J_1IEXCHDR Excise invoice header detail

J_1IEXCDTL Excise invoice line item details

J_1IGRXREF Goods Receipt to Excise Invoice Cross Reference

J_1IPART1 Excise Part I details

J_1IPART2 Excise Part II details

J_1IRG23D RG23D register for the depot

J_1IRGSUM RG23 Summary of receipts and issues

J_1IRG1 Excise RG1 details

J_2IEXTRCT Extract table

J_2IEXDATE Extract table

J_2IREGBAL Balance table

J_2IRG1BAL Balance table

J_2IACCBAL Balance table

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● The data archiving tool for Country Version India consists of the following archiving objects:

� J_1I_EXDC

Archiving object for the excise document data and transaction data relevant to the excise documents

� J_1I_P1GRX

Archiving object for Part1 registers and corresponding entries from J_1IGRXREF table

� J_1I_RG23D

Archiving object for the RG23D register for the depot

� J_1I_RG1

Archiving object for the finished goods

� J_1I_EXBL

Archiving object for the Extract and Balance tables

Archiving Objects

Definition The archiving objects write the data to be archived into the info catalogs and deletes the data from the active database.

Use You have to call the archiving objects in a particular sequence. Each archiving object archives data in certain table(s).

Structure The sequence in which you have to call the archiving objects is:

J_1I_EXDC

This archiving object archives the following tables:

� J_1IEXCHDR

� J_1IEXCDTL

� J_1IPART2

� J_1IGRXSUB

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The selection criteria for this archiving object are:

○ Excise Group

○ Year

J_1I_RG1


� J_1IRG1


○ Excise Group

○ Serial Year

J_1I_P1GRX


� J_1IPART1

� J_1IGRXREF


○ Excise Group

○ Register Type

○ Serial Year

J_1I_RG23D


○ J_1IRG23D


○ Excise Group

○ Document Year

J_1IEXBL


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○ J_2IEXTRCT

○ J_2IEXDATE

○ J_2IREGBAL

○ J_2IRG1BAL

○ J_2IACCBAL

The selection criterion for this archiving object is:

○ Excise Group

Archiving the Data

Use This procedure lists down the steps required for:

• Writing the data into the info catalogs.

• Deleting the data from the active database.

Procedure To write the data into the info catalogs, execute the following steps:

Execute transaction SARA.

Enter the archiving object name.

Select the Write option.

Maintain the Variant for the archiving object.

Select the Variant that you have maintained.

Maintain the Start Date.

Maintain the Spool Parameters.

Select the Execute icon .

The system schedules a new archiving job.

Select the Job Overview icon to get the overview of scheduled archiving jobs.

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To delete the archived data from the active database, execute the following steps:

Execute transaction SARA.

Enter the archiving object name.

Select the Delete option.

Select the Archive Selection option

The Archive Administration: Select Files for Delete Program dialog box appears.

Select the file(s) to be deleted.

Maintain the Start Date.

Maintain the Spool Parameters.


Select the Job Overview icon to get the overview of scheduled archiving jobs.

Execute transaction SARI .

Select the archiving structure and the corresponding info catalog.


Check the data that is archived.

Result The system writes the data into the info catalogs and deletes the data from the active database.

Transaction Codes for India

Transaction Action

J1I2 Prepare a sales tax register

J1I3 Create outgoing excise invoices in batches

J1I5 Update the RG 1 and Part I registers

J1IEX Incoming Excise Invoices (central transaction)

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J1IEX_C Capture an incoming excise invoice (excise clerk)

J1IEX_P Post an incoming excise invoice (excise supervisor)

J1IF01 Create a subcontracting challan

J1IF11 Change a subcontracting challan

J1IF12 Display a subcontracting challan

J1IF13 Complete, reverse, or recredit a subcontracting challan

J1IFQ Reconcile quantities for subcontracting challans

J1IFR List subcontracting challans

J1IH Make a CENVAT adjustment posting

J1IIN Create an outgoing excise invoice

J1IJ Assign excise invoices to a delivery for sales from depots

J1INJV Adjust withholding tax Item

J1INREP Reprint a withholding tax certificate for a vendor

J1IQ Year-End Income Tax Depreciation Report

J1IR Download register data

J1IS Process an excise invoice (outgoing) for other movements

J1IU Process exemption forms

J1IW Verify and post an incoming excise invoice

J1IX Create an incoming excise invoice (without reference to purchase order)

J2I8 Transfer excise duty to CENVAT account

J2IU Remit excise duty fortnightly

J2I9 Monthly CENVAT return

J1IG Excise invoice entry at depot

J1IGA Create additional excise entry at depot

J2I5 Extract data for excise registers

J2I6 Print excise registers

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