Professional Documents
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Sales and Distribution CIN PDF
Sales and Distribution CIN PDF
SD CIN ....................................................................................................................................................................................................................... 3
Excise Invoice (Outgoing) .................................................................................................................................................................................... 4
Material Master (Excise Data) ............................................................................................................................................................................ 5
Vendor Master (Country Version India Data) ............................................................................................................................................. 5
Customer Master (Country Version India Data)......................................................................................................................................... 6
Pricing .......................................................................................................................................................................................................................... 7
Excise Duties......................................................................................................................................................................................................... 7
Sales Taxes ............................................................................................................................................................................................................ 8
CUSTOMIZATION SETTINGS .............................................................................................................................................................................. 8
Basic Settings ....................................................................................................................................................................................................... 8
Excise Registration........................................................................................................................................................................................ 8
Maintain Company Code Settings ........................................................................................................................................................... 9
Plant Setting ...................................................................................................................................................................................................10
Maintain Excise Groups .............................................................................................................................................................................10
Maintain Series Groups .............................................................................................................................................................................13
Maintain Excise Duty Indicators............................................................................................................................................................13
Determination of Excise Duty .................................................................................................................................................................14
Master Data .........................................................................................................................................................................................................16
Maintain Chapter IDs .................................................................................................................................................................................16
Assign Users to Material Master Screen Sequence for Excise Duty ........................................................................................17
Define Form Types ......................................................................................................................................................................................17
Account Determination ..................................................................................................................................................................................18
Define G/L Accounts for Taxes ...............................................................................................................................................................18
Specify Excise Accounts per Excise Transaction ............................................................................................................................19
Specify G/L Accounts per Excise Transaction..................................................................................................................................20
Sales from Factories - (J1IIN) ...........................................................................................................................................................................22
Automatic Creation of Excise Invoices ....................................................................................................................................................23
Exemption Forms .............................................................................................................................................................................................24
Export-Oriented Units ....................................................................................................................................................................................24
Creation of Excise Invoices in Batches.....................................................................................................................................................25
Printout of Excise Invoices ...........................................................................................................................................................................26
Creating Pro Forma Excise Invoices .........................................................................................................................................................26
Creating Excise Invoices ................................................................................................................................................................................27
Excise Duty Utilization...............................................................................................................................................................................28
Duty Payable on Sale or Transfer of Capital Goods ............................................................................................................................30
Canceling Excise Invoices..............................................................................................................................................................................31
Country-Specific Functions
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
The country template for India comes with sample pricing procedures, including all taxes, and settings for
automatic account determination to the appropriate excise accounts.
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
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).
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.
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:
a. Number your outgoing excise invoices in sequential order, starting each year on 1 April.
b. You must notify the excise authority of the jurisdiction of the invoicing location.
c. 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 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 pre-numbered 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.
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 or Excise Duty.
VENDOR MASTER (COUNTRY VERSION INDIA DATA)
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
Purchasing Master Data Vendor Central ....
Logistics
Materials Management
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)).
TAN Exemption
You can define the withholding tax exemption for a vendor on the basis of the tax account deduction number (TAN).
Choose the CIN Details pushbutton. On the resulting screen, under the TAN Exemption tab, make the following settings:
Enter the section code that identifies under which TAN the tax was deducted.
Assign a period to this certificate number that identifies the duration for which the tax exemption is applicable.
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:
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
For each form of excise duty, there are three separate condition types as follows:
Excise duty Ad valorem Specific Total*
Basic
JEXP
JEXQ
JEXT
Additional
JEAP
JEAQ
JEAT
Special
JESP
JESQ
JEST
Cess
JCEP
JCEQ
JCET
* 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:
Table Conditions
362
357
358
371
369
372
* 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:
Table Conditions
359
367
368
Country, Region Of Delivering Plant, Region Of Ship-To Party, Customer Tax Classification, Material Tax
Classification
CUSTOMIZATION SETTINGS
Basic Settings
Excise Registration
An entity in India that is entitled by law to produce any goods liable to excise. Each entity is assigned its own excise
registration number.
Every factory that manufactures excisable goods is required to register separately, so that a business with seven
factories requires seven registrations.
Specifies that the excise registration is allowed to credit only a portion of its input excise duty to its CENVAT
account.
Dependencies
When you post a goods receipt, the system splits the input excise duty on the material into its deductible and
nondeductible amounts. It posts the deductible duty to the appropriate CENVAT account, and adds the
nondeductible duty to the material value.
This information is also shown when you post the incoming excise invoice.
Maintain Company Code Settings
Exch. rate type for CVD: You can use the exchange rate type to define a buying rate, selling rate, or average rate
for translating foreign currency amounts. You can use the average rate for the currency translation, and the bank
buying and selling rates for valuation of foreign currency amounts.
Exchange rate type for exports:
CVD (Countervailing duty): A form of excise duty imposed on imports that are subsidized by the country in which
they were manufactured.
Countervailing duty (also known as CVD) is intended to make the imports more expensive, thereby redressing any
competitive advantage they might have over goods produced locally.
Plant Setting
Specifies whether you are allowed to receive more than one delivery per excise invoice, and if so, whether you can
take the CENVAT credit immediately (Multiple Credits) or have to wait until the delivery has been made in full
(Single Credit).
Instructs the system, when you post a goods receipt using an incoming excise invoice as a reference document, to
copy the excise invoice quantity to the goods receipt.
Excise Invoice during Billing:
Instructs the system to automatically create an outgoing excise invoice immediately you create a commercial
invoice or a pro forma invoice.
The system creates the excise invoice in the background.
Dependencies
If you want to make use of this function, you must also define the default plant, excise group, and series groups
in Customizing for Excise Duty, by choosing Business Transactions -> Outgoing Excise Invoices -> Maintain Default Excise Groups
and Series Groups.
Instructs the system to automatically verify and post excise invoices that you create using the Excise Invoices for
Other Movements transaction.
Consumption: Create Part I Entry for Direct Consumption:
Automatically creates two entries in Part I of register RG 23 A or RG 23 C immediately you post a goods receipt for
direct consumption, one entry to record the goods receipt, and one for the goods issue.
Use
Uniquely, goods for direct consumption are not added to a material stock. Instead, the system posts them straight
to a consumption account. You do not create a separate goods issue.
However, with other goods, it is the goods issue material document that causes the system to create the Part I
entry for the goods issue.
This function overcomes that problem: When you enter a goods receipt for direct consumption, the sysstem
automatically creates two Part I entries (for the receipt and the issue) from the goods receipt document.
Examples:
You enter a goods receipt for 100 lengths of steel for direct consumption. The system creates a single material
document for the goods receipt and issue. From this material document it generates two Part I entries for register
RG 23 A, one for the goods receipt and another for the goods issue.
Depot Indicator: Depots are required to prepare register RG 23D, and follow different procedures for goods receipt and
invoice generation.
Generate Folio Numbers: Automatically generates a folio number when you post goods receipts and goods issues
that are recorded in register RG 23D.
Folio Number: A number assigned to all entries in register RG 23D.
When you enter a goods receipt at a depot, the system generates a separate register entry for each line item in the
material document. The entries are numbered consecutively. This is the folio number.
Example
A warehouseman enters a goods receipt for one table and four chairs. The system generates two entries in register RG
23D, one for each line item. Both entries have the same serial number, but each has a different folio number.
Depot Excise invoice: Automatically verifies and posts the selection of excise invoices that you have
assigned to a delivery from a depot.
Capture Excise Invoice in MIGO: Enables users to capture incoming excise invoices when they enter a
goods receipt in the standard Goods Movement transaction, (MIGO).
No utilization Flag
If you do not need any CENVAT utilization for an excise invoice but would like to just generate an excise invoice
then you need to mark this indicator.
If the flag is checked then system will create an Excise invoice in the given Series group but there will not be any
account postings or Part2 postings.
Immediate Utilization of CENVAT
Specifies that when you create an excise invoice, the system immediately pays the amount from CENVAT and creates
the Part II entry. Such invoices will not be listed for fortnightly utilization. If you have both fortnightly and
immediate utilization for the same excise group, the account determination within CIN IMG should point to the ED
interim account. Account determination for immediate payment will be done exactly the same as being done for
fortnightly utilization program.
Maintain Excise Duty Indicators
If you use condition-based excise determination, use a copy of the tax procedure TAXINN.
If you use formula-based excise determination, use a copy of the tax procedure TAXINJ.
This tax procedure also supports condition-based excise determination, so that you can work with both
concurrently.
We strongly recommend that new customers use condition-based excise determination. Note that once you have started
using a tax procedure, you cannot switch to another one; otherwise you will not be able to display old documents.
Activities
If you use condition-based excise determination, fill out the CVD cond. field and leave all the others blank.
If you use formula-based excise determination, fill out all of the fields as follows:
Enter the tax procedure and the pricing conditions that are relevant for excise tax processing.
Specify the purchasing and sales conditions types used for basic excise duty, additional excise duty, special
excise duty, and Cess.
Specify the conditions in the sales order that are used for excise rates.
Specify the countervailing duty condition type used for import purchase orders.
In addition, when you create a purchasing document, the system only uses the condition types that you enter here.
For taxes on purchases, use the condition types contained in the tax procedure.
For taxes on sales, use the condition types contained in the pricing procedures.
Master Data
Maintain Chapter IDs
Is the number given to a material in the schedules of materials published by the government of India.
The schedule lists all materials involved in manufacturing, input materials and output materials alike. It shows how
much excise duty is levied on each material. Each material in the schedule is assigned its own identification code,
called "chapter ID."
Example
The schedule contains an entry for ceramic roofing tiles, which are liable to basic excise duty at 16%. The chapter
ID associated with these tiles is 6903.10.
Account Determination
Define G/L Accounts for Taxes
You specify which G/L accounts you will use to record which taxes.
Assign an account to each of the following posting keys. The accounts for VS1, VS2, and VS3 are used as clearing
accounts during excise invoice verification.
You specify which excise accounts (for excise duty and CENVAT) are to be posted to for the various transaction
types. Enter all the accounts that are affected by each transaction type.
If you use subtransaction types, enter the accounts for each subtransaction type as well.
Activities
Transaction type UTLZ is used for determining accounts only while posting excise JVs and also if the payment of
excise duty has to be done fortnightly.
The fortnightly CENVAT payment utility picks up the credit side accounts from the transaction types of GRPO,
EWPO, and TR6C for determining the CENVAT and PLA accounts. There is no separate transaction type for
fortnightly payment.
Example
Excise TT DC ind Account name
GRPO
CR
GRPO
CR
RG 23 BED account
GRPO
DR
Excise group
Company code
Chart of accounts
Furthermore, if you want separate account determination settings within an excise group, you can also use sub
transaction types.
Requirements
Activities
For each excise group, assign the excise and CENVAT accounts to G/L accounts. For most businesses, one set of
accounts will suffice for all transactions.
Note
You need not remit the CENVAT to the excise department immediately, so maintain the credit account for
transaction type DLFC as an excise duty interim account. This will be set off when you remit the duty.
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:
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
standard procedure.
standard procedure.
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.
5. You ship the goods.
6. 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).
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 Basic
Settings Maintain Excise Groups.
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
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.
Day-to-Day Activities
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.
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.
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 (J1ILN CIN) screen, choose Indirect Taxes Sales/Outbound
Movements Excise Invoice For Sales Order Batch Utilization (J1I3)
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:
o
o
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.
o
You have:
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.
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.
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:
You have:
You make both of these settings in Customizing for Logistics - General, by choosing
India Basic Settings Maintain Company Codes .
Procedure
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Sales
Order Outgoing Excise Invoice Create/Change/Display ...
1) If you want to create the excise invoice with reference to a pro forma excise invoice or commercial invoice,
choose Excise Invoice Create.
a) If you want to create the excise invoice with reference to a delivery note, choose
(Due List).
(Continue).
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.
3. Enter header data as required.
4. To check if the utilization is done properly and the document is ready for posting, choose
5. To enter texts for the excise invoice, choose
6. To display the utilization details, choose
(Check).
(Change text).
(Calculate).
The system displays the available balance against each duty (CENVAT and Service tax) and each register type. In
the Balance Utilization group box, the system lists the amount due and the corresponding account from which the
amount is to be deducted. You can overwrite these fields if you want, and choose
utilization is possible.
Creates an accounting document that debits the accounts from which the excise duty or the service tax is
to be paid.
Account
Debit
CENVAT payable
150.00
Credit
Register RG 23A
50.00
Service Tax
100.00
o
Generates entries in the Part II table for CENVAT payable. Based on the register used for utilization, the
system assigns the following entries:
S if Service tax credit is used for setting off the CENVAT payable
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
much excise duty will be charged on the sale.
Balance utilization
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.
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:
1. ...
1.
2.
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:
Deemed exports
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.
It calculates the number of quarters that occur from the date you take the original credit until the date you sell or transfer
the goods.
As a result, the recipient only pays for the reduced excise duties.
Activities
Create an excise invoice using Creating Excise Invoices and Other Outward Movements transactions at the item level,
and enter data as usual.
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 .
Enter the number, year, and series group of the excise invoice that you want to cancel.
Choose Yes.
Save the adjustment posting.
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
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 RG23D register and the excise recovered from the customer.
Prerequisites
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
standard procedure.
The standard pricing procedures for depot sales are JINDEP (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.
From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot
Create/Change/Display.
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.
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.
Enter the internal document number of the excise invoice sent by the factory.
Choose more documents to go the excise invoice details screen.
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.
From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot
Create/Change/Display.
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 shipfrom 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.
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.
Enter the internal document number of the excise invoice sent by the factory.
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.
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.
Go back to the item details screen.
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 been used
in any sales.
From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot
Additional Excise Entry at Depot.
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.
You can maintain the A certificate number, date, and additional BED, AED ,SED and CESS for a given RG 23D
Folio.
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.
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.
Once an A certificate is used for removals then it cannot be changed.
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.
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
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice
For Depot Create/Change/Display Delivery or Material Document RG 23D Selection.
Enter the delivery document number or the material number and choose .
Select the excise invoice you want.
Choose .
Choose Excise invoice.
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.
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.
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice
For Depot Create/Change/Display Delivery or Material Document Verify/Post.
Enter the number of the delivery that you want to verify and choose .
Make sure that the information is correct.
Save the data.
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:
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 Basic
Settings Maintain Excise Groups.
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.
This is the procedure that you follow to create an excise invoice for the less common types of goods movement.
Procedure
1. From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice
For Other Movements Create/Change/Display (J1IS) .
2. On the selection screen, enter data as required, including:
o Reference group box
Specify which document you want to create the excise invoice for and which excise group it is for.
o
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:
o Material
o Quantity
o Unit of measure
o Base value
o 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.
Duty Payable on Sale or Transfer of Capital Goods
If a service provider receives a CENVAT credit on capital goods, upon sale or transfer of used capital goods, the
service provider must pay a percentage of the CENVAT credit for each yearly quarter after the credit was taken.
The system enables you to calculate the duty payable by the service provider for the capital goods. This duty is
applicable to used capital goods when sold or transferred.
Note
If the goods are transferred within the same financial year, then no duties are applicable.
End of the note.
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. On this screen, under Master Data, select Material and
Chapter-Id combination.
Features
When you post an invoice with a reduced amount at item level, the system:
It calculates the number of quarters that occur from the date you take the original credit until the date you sell or
transfer the goods.
As a result, the recipient only pays for the reduced excise duties.
Activities
Create an excise invoice using Creating Excise Invoices and Other Outward Movements transactions at the item level,
and enter data as usual.
From the SAP Easy Access screen (J1ILN), choose Indirect Taxes Sales/Outbound Movements Excise
Invoice For Other Movements Post Excise Invoice.
Enter the internal document number of the excise invoice.
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.
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice
For Other Movements Create/Change/Display .
Enter the internal document number.
Choose .
A dialog box appears, asking you to confirm whether you want to delete the excise invoice.
Choose Yes.
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
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For
Other Movements Create/Change/Display .
On the selection screen, enter data as required, including:
o Ref. doc. type:
From the SAP Easy Access screen, choose Logistics Materials Management Inventory Management
Goods Movement Transfer Posting.
Choose Movement type Transfer posting Plant to plant To stock in transit.
Enter the number of the issuing plant and storage location.
Choose To purchase order.
In the dialog box, enter the number of the stock transport order that the receiving plant created and choose
.
Check the data.
Save the transfer posting.
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.
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
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
Statement Regarding Export of Excisable Goods.
Excise Bond
Definition
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.
Day-to-Day Activities
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.
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
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.
Day-to-Day Activities
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
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
To access the individual functions shown in the table, from the SAP Easy Access screen, choose Indirect Taxes
Master Data Excise Bond.
Function
You can only cancel a bond if you have not yet used it.
You must have closed all of the ARE-1s that the bond covers.
Close
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
4. 2. 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.
5. 3. 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.
6. 4. 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.
7. 5. 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.
8. 6. 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.
9. 7. 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
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under
Excise Regulations Exports Central Processing Create ARE-1.
In the top line:
On the Package Details tab, enter any relevant information about how the goods are packaged.
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:
Procedure
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under
Excise Regulations Exports Central Processing Change ARE-1.
In the top line:
a. Select Change.
b. Select ARE-1 Internal Document.
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
Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Post ARE-1.
a. Select Post.
b. Select ARE-1 Internal Document.
c. Enter the internal ARE-1 number and fiscal year and choose .
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)
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
Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Update ARE-1.
the top line:
a. Select Update.
b. Select ARE-1 Internal Document.
c. Enter the internal ARE-1 number and choose .
3. On the Certification Dates tab, fill out the following dates as per the ARE-1:
o Arrived at Customs
o Countersigned by Customs
o 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.
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
Generates a Part II entry in the registers that you have specified (see
Excise Registers)
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 when
you removed them from your premises. Consequently, you must pay the excise duty plus interest (see Interest
Calculation).
Procedure
the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Reverse ARE-1.
Generates a Part II entry in the registers that you have specified (see
Excise Registers)
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 amount of excise duty back to the bond (see Bond Balance)
To access the report, from the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound 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
To access the report, from the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound 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:
Part Shows
I
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
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.
Day-to-Day Activities
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
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. Later,
when you come to claim the rebate, you will not be able to claim back the excise duty on the shortfall.
6. 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.
7. 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
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under
Excise Regulations Exports Central Processing Create ARE-1.
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. 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.
1. 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.
On the Package Details tab, enter any relevant information about how the goods are packaged.
Result
The system:
Which
Procedure
the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Change ARE-1.
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.
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
Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Post ARE-1.
a. Select Post.
b. Select ARE-1 Internal Document.
c. Enter the internal ARE-1 number and choose .
3. On the Certification Dates tab, enter the date and time that the goods are being dispatched.
a. Select Update.
b. Select ARE-1 Internal Document.
c. Enter the internal ARE-1 number and choose .
3. On the Certification Dates tab, fill out the following dates as per the ARE-1:
o Arrived at Customs
o Countersigned by Customs
o 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.
In the detail data, on the Quantities tab, enter the amended quantity, and choose .
The system displays the shortfall in the Differential Qty field.
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
From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Exports Under
Excise Regulations Exports Central Processing Reverse ARE-1.
In the top line:
a. Select Reverse ARE-1.
b. Select ARE-1 Internal Document.
c. Enter the internal ARE-1 number and choose .
3. On the Document Details tab, enter the reason for reversing the ARE-1.
4. Save the ARE-1.
Result
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
es Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Update ARE-1.
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
Sales/Outbound Movements Exports Under Excise
Regulations Exports Central Processing Update ARE-1.
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
Carry out the IMG activities in Customizing for Logistics General, under Tax on Goods Movements India
Business Transactions Exports Under Excise Regulations Deemed Exports and Printouts of ARE
Documents.
Master Data
Enter your customers' deemed export licenses in the system.
Day-to-Day Activities
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.
License Numbering
Use
When you create a deemed export license, the system automatically assigns it an internal license number.
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.
Day-to-Day Activities
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
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.
Day-to-Day Activities
The system will not allow you to assign an invalid license to an ARE-3.
Follow-on
path
Create
license
a Create
The system assigns the license an internal license number and sets the license
status to Active.
Change
license
a Change
You can only change a license if you have not already assigned it to an ARE-3.
Display
license
a Display
Cancel
license
a Cancel
You can only cancel a license if you have not yet used it.
The system sets the status to Canceled.
Close a license when all of the ARE-3s that it has covered are closed.
The system sets the status to Closed.
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
2. ...
10. 1. 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.
11. 2. The shipping department sends the goods to the customer, together with the excise invoice and the ARE-3.
12. 3. When the customer's warehouseman receives the goods, he checks whether the excise invoice and the ARE3 match the goods.
If he finds that there are fewer goods than stated on the ARE-3, he enters the shortfall in the ARE-3.
He then fills out Part 2 of the ARE-3 (Certificate of Warehousing by the Consignee) and sends it back to the excise clerk.
13. 4. When the excise clerk receives the ARE-3, he updates the ARE-3 in the system.
He fills out the various certification dates in the ARE-3 (for example, the date when the ARE-3 arrived back at your
company).
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 system creates the ARE-3 and assigns it an internal ARE-3 number (see ARE Document Numbering).
Changing ARE-3s
Use
Once you have created an ARE-3, you can still change the following information until you post it:
Which
Procedure
Sales/Outbound Movements Exports Under Excise
Regulations Deemed Exports Central Processing Change ARE-3.
a. Select Change.
b. Select ARE-3 Internal Document.
c. Enter the internal ARE-3 number and choose
3. Change data as required.
4. Save the ARE-3.
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.
You can still make any changes that you need to before you post it.
Procedure
rect Taxes Sales/Outbound Movements Exports Under Excise
Regulations Deemed Exports Central Processing Post ARE-3.
a. Select Post.
b. Select ARE-3 Internal Document.
c. Enter the internal ARE-3 number and choose .
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)
License Balances)
You can no longer change the ARE-3. However, you can still reverse it, if need be. Otherwise, the next step is to
update it.
Updating ARE-3s
Use
When the goods arrive at the customers 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
rect Taxes Sales/Outbound Movements Exports Under Excise
Regulations Deemed Exports Central Processing Update ARE-3.
a. Select Update.
b. Select ARE-3 Internal Document.
c. Enter the internal ARE-3 number and choose .
3. On the Certification Dates tab:
o Enter the Countersigned by Customer date as per the ARE-3.
o Enter the Arrived Back date.
4. Enter any shortfalls that the customer has noted on the ARE-3.
5. Save the ARE-3.
Result
Generates a Part II entry in the registers that you have specified (see
Excise Registers)
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):
Reversing ARE-3s
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
Indirect Taxes Sales/Outbound Movements
Excise Regulations Deemed Exports Central Processing Reverse ARE-3 .
Exports Under
(Continue).
3. On the Utilization tab, specify the service tax credit or 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:
Generates a Part II entry in the registers that you have specified (see Excise Registers). Based upon the register
used for utilization, the system assigns the following entries:
o
S if Service tax credit is used for setting off the CENVAT payable
Creates an accounting document to debit the excise duty to the CENVAT reversal account and credit it to the
service tax credit accounts and other 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 service tax account):
Account
Debit
CENVAT reversal
150.00
Credit
Register RG 23A
50.00
Service Tax
100.00
Displays the available balance against each duty (CENVAT and Excise duty) and each register type. 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
(Check) to check whether utilization is possible.
Does not reinstate the value or quantity of the goods to the license
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).
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
Summary
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.
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.
Tab
Use
Item
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
Duty Values
The excise duty on the item, and how much of it has already been credited to the CENVAT
accounts.
License
Package Details
Any information about the packages that needs to be printed on the ARE document.
Reference
Documents
Additional Data
Fields for any additional information that you might want to enter, this time at item level.
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.
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.
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.
Day-to-Day Activities
When you create an ARE document and you want to enter a long text for it, on the Additional Data tab, choose
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.
Long
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
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.
Day-to-Day Activities
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.
Enter the rewarehousing period in Customizing for Logistics General, by choosing Tax on Goods Movements
India Business Transactions Exports Under Excise Regulations Deemed Exports.
Day-to-Day Activities
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
a. Select Update.
b. Select ARE-1 Internal Document or ARE-3 Internal Document.
c. Enter the internal ARE document number and choose .
Certification Dates tab, fill out the Extended Until field.
This field only appears once an ARE document exceeds the export period or rewarehousing period.
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.
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.
Day-to-Day Activities
The system automatically calculates interest when:
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
Excise Invoice Summary tab, enter the excise invoice number and year in the Additional Excise Invoices
field.
.
Excise Invoice Summary tab, enter the excise invoice number and year in the Additional Excise Invoices
field.
.
Canceling AREs
Use
If you have already created an ARE document but not yet posted it, you can cancel it if you need to.
Procedure
Sales/Outbound Movements Exports Under Excise
Regulations Exports or Deemed Exports Central Processing Cancel ARE-1 or Cancel ARE-3.
a. Select Cancel.
b. Select ARE-1 Internal Document or ARE-3 Internal Document.
c. Enter the internal ARE number and choose .
The period can refer to the next so many days, or the past so many days, depending on what status you have
selected.
c. Choose
Output
Each document is assigned a status as follows:
: Activity is overdue
: Activity is due today
: Activity has been completed
Transaction Codes
Transaction Function
J1IA101
J1IA102
J1IA103
J1IA104
J1IA301
J1IA302
J1IA303
J1IA304
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
J1IANX19
FORM TRACKING
Use
You use this function to record and monitor forms relating to tax concessions. You can record the forms that your
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.
SALES REGISTER
In India, you use this report to determine the various taxes and duties that sales organizations pay for sales
transactions over a period of time.
Features
Selection
o
o
o
Sales Order
Delivery
Billing
If you choose the Sales Order radio button, then enter the sales order number, sales order date, and sold-to party
details. In the Sales Process group box, choose any one of the following:
Domestic
Export
Sales
If you choose the Delivery radio button, then enter the sales delivery number, sales delivery date, and ship-to party
details. In the Sales Process group box, choose any one of the following:
Domestic
Export
Interstate
Intrastate
All
If you choose the Billing radio button, then enter the sales billing number, sales billing date, and business place
details. In the Sales Process group box, choose any one of the following:
Domestic
Export
All
Output
The result screen displays the sales orders, dispatches, billing invoices/documents, and receipts of your sales and
excise invoices.
Activities
To access this report on the SAP Easy Access screen, choose
Register .
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
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 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
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
From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create (J1IH) Matl write-off.
Specify which account is affected by the adjustment posting is for. If the posting does not have to be remitted
immediately, select Fortnightly payment.
Choose
From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create Matl non-prod.
Enter data as required, including:
o Document number
Enter the number of the material document that the adjustment posting is to refer to.
o
Specify which account is affected by the adjustment posting is for. If the posting does not have to be remitted
immediately, select Fortnightly payment.
Choose
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
From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create Additional excise.
Enter data as required.
In the Document number field, enter then number of the document sent to you by the vendor.
Choose .
Adjust the posting date as necessary.
Enter the amount of excise duty in either of the following ways:
o To enter line items for different materials and the excise duty accordingly, choose
and enter
the line items in the table.
o To enter the excise duty only, choose
and enter the excise duty in the totals fields at the foot of
the screen.
If the duty qualifies as countervailing duty (CVD):
a. Select CVD applicable.
b. Enter the CVD amount in the BED amount field.
Specify
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
From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create TR6 challan.
Enter data as required, including the document number.
You can enter either the challan number or the number of the accounting document.
Choose
If you entered the accounting document number, the system displays the information from it.
You follow this procedure in order to cancel an outgoing excise invoice. It reverses any excise duty accounted for.
Procedure
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 .
Enter the number, year, and series group of the excise invoice that you want to cancel.
Choose Yes.
Save the adjustment posting.
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
From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create Other adj.
Enter data as required, including:
o Document number
Enter the number of the external document that you want to refer to.
o
Specify which account is affected by the adjustment posting is for. If the posting does not have to be remitted
immediately, select Fortnightly payment.
Choose
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.
The system:
o
o
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
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.
Add another account, if you need to, and adjust the other postings so that the credits and debits match.
Enter a business area and cost center, if necessary.
To close the dialog box, choose .
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
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.
Activities
For information about how to create the registers, see Creation of Excise Registers.
Excise Registers:
a. RG23A Part I: - Part I shows the quantities of the Input Materials.
b. RG23C Part I: - Part I shows the quantities of the Capital Goods.
c. RG23A Part II: - Part II shows the amounts of excise duty on the Materials, and how much you have
transferred to the CENVAT accounts.
d. RG23C Part II: - Part II shows the amounts of excise duty on the Capital Goods, and how much you have
transferred to the CENVAT accounts.
Note: - 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.
e. PLA: - Personal Ledger Account
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
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 (Page 89).
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.
Day-to-Day Activities
The system does not automatically generate entries for goods receipts from production orders. You have to
generate this 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
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:
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.
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:
Periodic Processing
Generate the missing entries once a day using the Update of Registers RG 1 and RG 23 (Part I) program.
Reporting
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
Day-to-Day 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 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.
Day-to-Day Activities
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
In procurement, when the warehouseman posts a goods receipt, the system creates a register entry.
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
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.
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
Customizing
Set up the number ranges in Customizing for Logistics General, by choosing Taxes on Goods Movements India
Tools Number Ranges.
Day-to-Day Activities
Whenever the system creates a register entry, it automatically assigns it a serial number.
Reporting
The serial numbers are shown in the excise registers when you prepare them.
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.
When you need to submit the registers, you run the Data Extraction report, and the system saves the data
to an internal table.
You run the Register Printout report, which reads the data from this table and prints it out.
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
EXGRP
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
OP FN UOM
OP BN UOM All quantities in this table are updated in the base unit of measure of the material.
CB FN UOM
USNAM
CPUDT
Date of entry
CPUTM
Time of entry
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:
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.
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
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.
o You can reselect the required line items and repeat the Simulate process.
3. Select the line items you want and choose
Register entry.
o
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).
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:
Field
Entry
EXGRP
REGISTER
Type of register
Make an entry for each of the following:
RG23ABED
RG23ASED
RG23AAED
RG23CBED
RG23CSED
RG23CAED
PLABED
PLASED
PLAAED
PLACESS
DATUM
WERKS
OP BAL
CL BAL
EXAMT
EXIND
USNAM
CPUDT
Date of entry
CPUTM
Time of entry
Features
To access the report, from the SAP Easy Access screen, choose Indirect Tax Registers Excise Tax Extract.
Selection
On the selection screen, enter data as follows:
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:
Output
RG 1
RG 23 A and RG 23 C (Parts I and II)
PLA
Plant excise details
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
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
Length
Use
REGTYP
Register
A
RG23A
RG23C
TRNTYP
EXGRP
Excise group
SNO
10
SYEAR
PDATE
Posting date
MAKTX
40
Material description
MENGE
13
Quantity
MEINS
Unit
EXNUM
10
EXDAT
NAME1
35
Vendor name
ORT01
35
City
PSTLZ
10
Pin code
EXCCD
20
EXCRN
20
EXCRG
40
EXCDI
20
Division number
EXCCO
20
CHAPID
12
Chapter ID
P2NO
10
RISIND
Receipt/issue indicator
STATUS
Entry status
U
Undeclared material
Deleted item
MBLNR
10
MJAHR
BWART
Movement type
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
Field
Length
Use
REGTYP
Register type
TRNTYP
RG23A
RG23C
PLA
Transaction type
57CM
57F4 completion
57FC
57NR
CAPE
Capital goods
CEIV
DIEX
DLFC
GRPO
MRDY
MRRD
MRWO
TR6C
OTHR
EWPO
EXGRP
Excise group
SNO
10
SYEAR
PDATE
Posting date
EXNUM
10
EXDAT
NAME1
35
Vendor/customer/subcontractor name
ORT01
35
City
PSTLZ
10
Pin code
EXCCD
20
EXCRN
20
EXCRG
40
EXCDI
20
EXCCO
20
BED
19
BED
SED
19
SED
AED
19
AED
CESS
19
CESS
CURR
Currency
CHAPID
12
Chapter id
P1NO
10
PREPRN
10
CVDIND
EXPIND
CAPIND
Blank
Local sale
Deemed export
CERTNO
20
Assets
Tools
Consumable
Consumable
Tools
CERTDT
ANLN1
12
REMARKS
50
Remarks
PROCES
50
STATUS
Status
Space
Normal
Reversed
RDOC1
10
RYEAR1
LIFNR
10
Vendor number
MBLNR
10
MJAHR
The table below shows the data structure of the file that the system creates when you download the data from RG
23D.
Structure
Field
Length
Use
INDCTR
Receipt/issue indicator
I
Issue
Receipt
EXNUM
10
EXDAT
NAME1
35
Vendor/consignee name
ORT01
35
City of vendor/consignee
PSTLZ
10
Pin code
EXCCD
20
EXCRN
20
EXCRG
40
EXCDI
20
Division number
EXCCO
20
Excise collectorate
MAKTX
40
Material description
MENGE
13
Quantity
MEINS
Unit
CHAPID
12
Chapter ID
BED
19
BED
SED
19
SED
AED
19
AED
CURR
Currency
VBELN
10
PDATE
Invoice date
NAME1B
35
Name of buyer
ORT01B
35
City of buyer
PSTLZB
10
Length
Use
WERKS
Plant code
NAME1
30
Plant name 1
NAME2
30
Plant name 2
STRAS
30
PFACH
10
PSTLZ
10
Postal code
ORT01
25
City
LAND1
Country
EXCCD
20
EXCRN
20
EXCRG
40
EXCDI
20
Division number
EXCCO
20
Excise collectorate
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
Client
EXGRP
Excise group
SYEAR
SERIALN
10
RG 1 serial number
MBLNR
10
MJAHR
ZEILE
BWART
MATNR
18
Material number
MENGE
Quantity
MEINS
MAKTX
40
Material description
RISIND
Receipt/issue indicator
DOWNL
Download indicator
DECLRD
EXPIND
Export type
REASON
40
RDOC1
10
Reference document 1
RYEAR1
Reference year 1
RIND1
BEDRATE
AEDRATE
SEDRATE
EXCUR
Currency
EXBAS
EXBED
EXAED
EXSED
CESS
Cess amount
STATUS
USNAM
12
Created by
CPUDT
CPUTM
Time of entry
AEDAT
Changed on
AENAM
12
Changed by
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
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.
In the General data group box, enter the company code and excise group.
In the Excise Invoice Selection group box, enter the posting date.
Output
The report displays the quarterly returns for the respective dealer. The return contains details about the materials
purchased by the dealer as well as details of materials sold by the dealer in the specified period.
If you select the XML checkbox on the selection screen, the report generates an XML file in the prescribed format as
required by law. The file is stored in .XML format and contains the following sections:
Header Data
Invoice Header
Document Header
Self-assessment Memorandum
Activities
1. To access the report, on the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice
Reports Monthly Return of Excisable Goods and Availment of CENVAT Credit .
2. Enter the selection criteria. This is based on the Excise Group, Plant and a particular month.
3. 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.
4. In the Output Format group box, you can select either one of the following:
o XML. If you select the XML button, then you also need to need to enter the path where you want to save
the file in the Details group box.
o Details. If you select the Details button, in the Details group box, select the section of the form that you
want to display in the Details group box.
5. Select the section of the form that you want to display and print. For a complete ER1 reporting, you must
print all the sections.
Purchase Register
In India, you use this report to determine the various taxes and duties that purchase organizations pay for
purchase transactions over a period of time.
Features
Selection
On the selection screen, enter the following details:
If you choose the Purchase Order radio button, then enter the purchasing document and document date details.
If you choose the Material Document radio button, then enter the material document and posting date details.
If you choose the Invoice radio button, then enter the invoice document number and posting date details.
In the Purchase Process group box, choose any one of the following:
o Domestic purchase
o Import purchase
o Intrastate purchase
o Interstate purchase
Output
The result screen displays the purchase orders, goods receipts, vendor invoices, and receipts of purchases and
vendor invoices.
Activities
u2022 Tarrange for the formats of all excise registers and reports. Tname a few
RG23A
RG23C
Monthly return for Excise
RG1
PLA
RT-12
MONTHLY REPORTS:
Transaction
Action
J1I2
J1I3
J1I5
J1IEX
J1IEX_C
J1IEX_P
J1IF01
J1IF11
J1IF12
J1IF13
J1IFQ
J1IFR
J1IH
J1IIN
J1IJ
J1INJV
J1INREP
J1IQ
J1IR
J1IS
J1IU
J1IW
J1IX
J2I8
J2IU
J2I9
J1IG
J1IGA
J2I5
J2I6
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.
Features
Country-Specific Functions
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:
It is one of the main excise duties in India. It is levied on a wide range of products, for example, foodstuffs, metals,
jewelry, leather goods, and machinery.
This too is a form of excise duty in India - on a limited number of goods, mostly luxury goods, including pan masala,
sparkling waters, furs, and yachts.
A form of excise duty, in India, levied on a select range of products, for the most part, textiles.
In India, a form of excise duty levied over and above additional excise duty. It applies to a range of products, such as
tobacco or high-speed diesel and oil.
Cess
Education Cess
A surcharge of 2% applicable in India, on the total excise duty for the product.
Countervailing duty
A form of excise duty imposed on imports that are subsidized by the country in which they were manufactured.
Countervailing duty (also known as CVD) is intended to make the imports more expensive, thereby redressing any
competitive advantage they might have over goods produced locally.
Imports duty in India, over and above the countervailing duty, basic customs duty and price of the product. This
duty is applicable on all products and is charged at 4% on the aggregate price plus duties. Education Cess is not
calculated on ADC.
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 portio0
n 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
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 (115 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.
You use the service tax clearing accounts for service payments and personal ledger accounts for CENVAT payments
respectively.
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
Maintained the various service tax G/L account details in Customizing for Logistics General, under Taxes
on Goods Movements India Service Tax Service Tax Account Assignment .
Features
On the selection screen of this report, you can no longer maintain the General Ledger (G/L) accounts. To maintain
the G/L accounts, do so in Customizing for Logistics General, under Tax on Goods Movements India Service Tax
Assign Service Tax Accounts .
Selection
Note
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.
Note
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).
Payment options
You can pay the CENVAT and Service Tax payable amount from CENVAT credit or service tax credit accounts.
Output
For each sort of excise duty, the system shows you:
How much credit you have at your disposal on the appropriate CENVAT account and Service Tax
account(Available balances)
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.
You can save the entries only when you have utilized all the duties. The system then:
Creates an accounting document that debits the accounts from which the excise duty or the service tax is to be
paid.
Account
Debit
CENVAT account
250.00
Credit
50.00
Service Tax
200.00
Generates entries in the Part II table for service tax payable. The system assigns a new register type T and also
updates the Excise Part II details (J_1IPART2) and the Excise invoice line item details (J_1IEXCDTL) tables with
the service tax serial number. Similarly, the system also generates entries in the Part II table for service tax
exemption payable and assigns new register type X.
The system generates entries in the Part II table for service tax utilization with register type S.
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
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:
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 CrossApplication Components General Application Functions Cross-Application Document Numbering Taiwan.
14. 1. Define Business Places for different plants.
15. 2. Assign Business Place to Sales Office.
16. 3. Maintain different document classes to generate different number ranges, for example, B for Bill of Sale, V
for VAT Invoice.
17. 4. Assign the document class for the VAT and BOS to the Document Type.
18. 5. Maintain the Number Group.
Service Tax
This is a tax that is levied on taxable services as defined by law. Service providers are responsible for the service tax
payment.
Prerequisites
In addition to the standard Implementation Guide (IMG) settings for taxes on sales/purchases, and deferred taxes, you
must also have maintained the tax registration numbers of your vendors, customers, and your own plants.
Note
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 if you have maintained a separate tax code for each
service registration number. 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 a certain percentage on the amount the service provider received for the services rendered.
The Education Cess and the Secondary and Higher Education Cess are applicable at a certain percentage on the
service tax.
For the service provider (for example, vendor, landlord), this is a deferred tax. The tax payment becomes liable on
receipts from the service receiver (for example, customer, tenant). In case of partial payment, the proportional
amount of the taxes (Service Tax, Education Cess, and the Secondary and Higher Education Cess) must be paid
to the tax authorities. The output taxes that became liable have to be transferred from the deferred tax account to
the normal output tax account with the Deferred Tax Transfer (RFUMSV50) program as described in SAP Note
921634.
For the service receiver, the tax credit can be utilized for payment of tax due when the vendor is paid for the whole invoice
amount. In case of partial payment, the assessee is not eligible to take credit on the proportional amount of the input
taxes. Consequently, the taxes must be transferred from the deferred tax account to the normal tax account when the
payment for the whole invoice is made.
The interim general ledger account contains the total service tax that you have to receive or pay as required. The final
general ledger account contains only the actual amount that you have received or paid. This means that the
corresponding tax codes have to possess a target tax code. The tax codes defined for Service Taxes should not have a
tax rate defined in the tax code itself. We recommend that you define the tax rate in the condition records of the tax
procedure (TAXINN) to cope with the frequent changes in tax rates easily.
The interim general ledger account contains the total service tax until the full payment of the invoice or receipt from
customer.
Credit utilization or tax payment amounts are determined from the final general ledger account.
Cross-utilization of input credit between Services and Goods is permitted, so you can use the Service Tax credit
to set off Basic Excise Duty that is payable by you.
This tax is payable to and administered by the Central Excise Commissionerates working under the Central Board
of Excise and Customs (CBES) of the Department of Revenue in the Ministry of Finance.
Corporate assessees need to pay the tax on the value of taxable service received in a month, by a specified
period in the following month. Period for payment of tax by individual assessees are also defined.
All the financial documents for which service tax must be paid should contain information about the business
place that identifies the tax office that is responsible for collecting the service tax.
In the Flexible Real Estate Management (RE-FX) component, the leased-out rental objects are subject to service tax that
you need to pay to the responsible federal tax office. You identify the federal tax offices with the business place.
Example
The price of the service is INR 10,000.
Service tax that is applicable is INR 1,000 (10%).
Education Cess is INR 20 and Secondary and Higher Education Cess is INR 10.
Total amount the customer needs to pay is INR 11,030. The system updates the interim general ledger account with this
amount.
For service provider:
Assume that the customer makes a partial 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.
For service receiver:
Assume that you pay the vendor (providing the service) the value of INR 11,030. In such a case, the credit of INR 1030
can be utilized to pay output tax.
Unlike other types of services in India, recipients of transport services from goods transport agencies (GTA) are
responsible for withholding and submitting the service tax to the tax authorities on behalf of the transport service
providers.
The system automatically calculates the GTA service tax and makes the relevant postings in Financial Accounting (FI).
Prerequisites
You have:
Entered the GTA withholding tax type and withholding tax code and selected the Liable checkbox in the vendor
master for your transport service vendors.
GR/IR clearing Dr
15000
15000
1800
To calculate and report GTA service tax, make the following settings (all under country key IN) :
Customizing
Settings
1.
Financial Accounting Financial Accounting
Global Settings
Withholding Tax
Extended
Withholding Tax Basic Settings Define Withholding
Tax Keys
2.
Financial Accounting Financial Accounting
Global Settings
Withholding Tax
Extended
Withholding Tax Calculation Withholding Tax Type
Define Withholding Tax Type for Invoice Posting
Create withholding tax type G1 with the name GTA, and make
the following settings:
3.
Financial Accounting Financial Accounting
Global Settings
Withholding Tax
Extended
Withholding Tax Calculation Withholding Tax Codes
Define Withholding Tax Codes
4.
Financial Accounting Financial Accounting
Global Settings
Withholding Tax
Extended
Withholding Tax Calculation Withholding Tax Codes
Define Formulas for Calculating Withholding Tax
Debit
10000
1000
Credit
Vendor
10000
GTA Payable
1000
In this procedure, you create a GTA challan to consolidate the total tax amount that the service recipient needs to remit to
the government.
Features
On the selection screen, enter the following data:
In the Company Details group box, enter the company code, fiscal year, and the business place.
In the Details of Withholding Tax Items group box, enter the section as GTA.
In the Tax Remittance Details group box, enter the document date, posting date, and the bank account.
Activities
1. Access this report on the SAP Easy Access screen by choosing Service Tax -> Goods and Transport Agency ->
Create Challan for Remittance of GTA Service Tax.
2. Maintain the relevant selection criteria on the selection screen.
3. Choose
(Execute).
(Continue).
The system selects all the accounting line items by default and displays them on the Post Outgoing Payments: Process
open items screen. To deselect a line item, double-click the relevant entry.
5. Choose the Charge off diff. pushbutton to enter the tax amount. On the Post Outgoing Payments: Display
Overview screen, to enter the total value, double-click the line item.
6. On the Post Outgoing Payments: Correct G/L Account Item screen, to compute the total tax amount, enter *.
7. In the menu bar, on the Document tab, choose Simulate.
The system creates an accounting document. The document debits the withholding tax payable account and credits the
bank account.
Account
Debit Credit
1000
You use this report to update the internal challan with the bank challan number after remittance of the total service tax to
the government.
Note
For challan amounts that have been updated with the bank challan numbers, you need to manually post from interim
service tax credit account to final service tax credit account.
Activities
1. To access this report on the SAP Easy Access screen, choose
Update Bank Challan for GTA Service Tax .
(Execute).
The system updates the Table for Internal and external Challan nos-EWT India (J_1IEWTCHLN) application table with the
bank challan details.
You use this report to capture the information about GAR-7 challan used to pay service tax. Once you remit the amount to
bank through GAR-7 Challan, you run this report to update the challan. You also have the option to capture the
information about any advance amounts paid and adjustments done if any.
Note
In case the GAR-7 challan is not updated, then few of the section-4 details will not be filled in the Service Tax report.
Using this report, you cannot update challan numbers for normal incoming invoices and normal outgoing invoices.
Prerequisites
You have:
Maintained the various service tax G/L account details in Customizing for Logistics General, under
Goods Movements India Service Tax Account Assignment .
Calculated how much excise duty and service tax you must remit to the authorities.
Taxes on
Features
Selection
On the selection screen, you enter the following data:
On the Doc. Data tab, enter the accounting document details such as company code, plant, and fiscal year.
If you choose Create in the Transaction field, then the provides the following output options:
o
The system also provides you an option to cancel based on the internal challan.
Output
The report updates the Recordings of GAR-7 (J_1IGAR7) table with GAR-7 details and creates separate forms for each
company code, plant, and fiscal year that you have entered. Each form shows the cash flow for each G/L account.
This report also shows the following information based on the settings you make on the selection screen:
Challan details
Cash payments made from the respective service tax G/L accounts
The system creates an accounting document to debit the excise duty to the individual service tax clearing accounts and
credit it to the bank accounts.
Account
Debit
Credit
Account
Debit
Credit
50.00
Service Tax
100.00
Activities
To access this report from the SAP Easy Access screen, choose
You use this report to file electronic service tax returns for services that are taxable. You prepare the service tax returns
on a half-yearly basis. However, the system also allows you to prepare the service tax returns from anywhere between 1
to 6 months.
Note
Using this report, you can generate details of only the following sections:
Section 4 - 4A(I)[a,b,c,d]and 4C
Assessees filing the service tax returns for the first time are required to furnish details regarding all of the accounts
maintained by them, pertaining to service tax.
Prerequisites
You have:
Customized the system so that when you create a service entry in Financial Accounting (FI), Materials
Management (MM), and Sales and Distribution (SD), the system automatically updates the invoices with service
category details in the Invoices with Service Category (J_1ISER_BSEG) table.
Determined how much excise duty and service tax you must remit to the authorities using the Monthly
Remittance of Excise Duty and Service Tax report.
Captured the amount paid in cash to the bank towards service tax and updated the GAR-7 challan.
Features
Selection
On the selection screen, you enter the following data:
Posting date
The date that you enter must be for the entire month (that is, from 1st to the 31st).
Output
The system displays the various sections of the form for a registration number of a plant for a particular reporting period
(anywhere between 1 to 6 months).
If you choose the Section 3 of ST3 report radio button on the selection screen, the system displays the gross amount
relating to the service provided for a particular service category. All the relevant details for the service provided for a
particular service tax category.
If you choose the Section 4 of ST3 report radio button on the selection screen, the system displays the service tax amount
payable. Displays GAR-7 relevant info.
If you choose the Section 5 of ST3 report radio button on the selection screen, the system displays the CENVAT credit
taken and utilized for different material types.
Note
You cannot run the report across fiscal years. For example, you cannot run this report from January 2009 to June 2009.
You use this report to maintain service categories while executing a business transaction that involves materials subject to
service tax. Using this transaction, the system automatically determines the service category for invoices.
Prerequisites
You have performed the following settings:
Assigned condition types to tax procedure in Customizing for Sales and Distribution, under Basic Functions
Pricing Pricing Agreements Set up Sales Deals Condition Type Groups Assign Condition Types/Tables To
Condition Type Groups .
Classified condition types in Customizing for Logistics - General, under Tax on Goods Movements India
Basic Settings Determination of Excise Duty Condition-Based Excise Determination Classify Condition Types
.
Classify the condition types irrespective of whether you use TAXINN (condition-based excise determination) or TAXINJ
(formula-based excise determination).
Defined tax codes in Customizing for Financial Accounting (New), under Financial Accounting Global Settings
(New) Tax on Sales/Purchases Calculation Define Tax Codes for Sales and Purchases .
Features
Selection
On the selection screen, select any one of the following:
If you select this radio button, the system allows you to define service categories for outgoing financial accounting
customer invoices for service tax reporting.
If you select this radio button, the system allows you to define service categories for incoming financial accounting vendor
invoices for reporting service tax.
If you select this radio button, the system allows you to define service categories for billing documents.
If you select this radio button, the system allows you to define service categories for invoices.
If you select any one of the above options and then choose the Key Combination pushbutton, a dialog box appears. In this
dialog box, a list of Customizing activities related to the selected service category is displayed. Select the relevant activity
and choose Continue. The system takes you to the selected Customizing activity screen, wherein you save your entries.
Activities
To access this report, on the SAP Easy Access screen, choose
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
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 a quarterly 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 quarterly 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:
The system automatically calculates the tax collected at source and makes the relevant postings in Financial
Accounting (FI) and Sales and Distribution (SD).
Prerequisites
You have:
Entered the TCS withholding tax type and withholding tax code and selected the W/tax checkbox in the customer
master.
The rate of tax collected at source differs based on the type of commodity.
The Education Cess and the Secondary and Higher Education Cess are applicable at a certain percentage on the
tax collected at source.
The seller of the items should furnish a tax certificate specifying whether tax has been collected, the amount that
has been collected, rate of tax applied, and such other particulars as may be prescribed.
Activities
You post the tax collected at source by creating:
1. A sales order using the Create Sales Order (VA01) transaction.
2. An outbound delivery using the Create Inbound Delivery (VL01) or the Create Inbound Delivery with Order
Reference (VL01N) transactions.
3. A billing document using the Create Billing Document (VF01) transaction.
Example
Consider an invoice for goods of INR 1000 and TCS of 10%. The goods buyer pays the tax collected at source. During the
creation of billing document, the system makes the following postings:
Account
1000
TCS payable Cr
100
To calculate and report tax collected at source, make the following settings (all under country key IN) :
Customizing
Settings
1.
Financial Accounting (New) Financial
Accounting Global Settings (New) Withholding
Tax
Extended Withholding Tax
Basic
Settings Define Withholding Tax Keys
2.
Financial Accounting (New) Financial
Accounting Global Settings (New) Withholding
Tax Extended Withholding Tax Calculation
Withholding Tax Type Define Withholding Tax
Type for Invoice Posting
Create withholding tax type S1 with the name Tax Collected at SourceBase and make the following settings:
- Base amount = Modif. net amount
- Rounding rule = Round w/tax amnt up
Copy the existing access sequence J1AW and create a new access
sequence J1IW with the name Withholding tax code - country-specific
and make the following settings:
- Access sequence-Access number = 10
- Condition table = 399
Create condition type JTCS with the name TCS-Base and make the
following settings:
- Access sequence = J1IW
- Cond. class = W
- Calculat. type = A
- Cond. category = D
- Select Item Condition checkbox
Similarly create condition types JTEC and JTSE with the names ECS
on TCS and SECess on TCS respectively and make settings as stated
above.
5.
Financial Accounting (New) Financial
Accounting Global Settings (New) Withholding
Tax Extended Withholding Tax Calculation
Withholding Tax Type Assign Condition Type
to Withholding Tax Type
Assign condition types JTCS, JTEC, and JTSE to withholding tax types
S1, S3, and S4 respectively.
6.
Financial Accounting (New) Financial
Accounting Global Settings (New) Withholding
Tax Extended Withholding Tax Calculation
Withholding Tax Code Define Withholding Tax
Codes
Create withholding tax code S1 with name TCS-Base and make the
following settings:
- Off. W/Tax Key = 206C
- Post.indic. = 3
Similarly create withholding tax codes S3 and S4 with the names
Education cess on TCS and SECess on TCS and make settings as
stated above.
7.
Financial Accounting (New) Financial
Accounting Global Settings (New) Withholding
Tax Extended Withholding Tax Posting
Accounts for Withholding Tax
Define
Accounts for Withholding Tax to be Paid Over
Enter the chart of accounts CAIN. You need to maintain the same G/L
account for the transaction key WIT-based tax line items and SD-FI
condition based tax line items.
Maintain a separate G/L account for the transaction key OFF-based line
items.
Since posting of TCS happens on both SD and FI documents, ensure
that you assign the same G/L account for each combination of
withholding tax type and withholding tax code.
Note
To post tax collected
maintain the same
Distribution,
by
Assignment/Costing
Accounts .
Select the pricing procedure JINFAC and double-click Control data. The
system displays the Control data screen.
Define the condition types JTCS, JTEC, and JTSE and add them to the
pricing procedure JINFAC. The system calculates the values of the
goods but does not post them directly to the Sales and Distribution
document (SD). Instead, posting takes place based on the assignment
of condition types to the withholding tax types (refer step 5).