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Tax configuration for condition based tax procedure - TAXINN Other terms VAT, CIN,TAXINN, Tax Procedure

, Tax Conditions Reason and Prerequisites Legal Change The customers ho ha!e alread" made the rele!ant changes for VAT #$$% ould onl" ha!e to ma&e the changes accordingl"' Solution (or VAT #$$), *AP recommends all customers to loo& into this note onl"' Initial Settings: • Tax procedure for countr" India is +TAXINN+' If "ou are using an" other Tax procedure similar to TAXINN , use the same in place of TAXINN in the recommended configuration settings' C, - Capital ,oods -. - .aterial other than Capital ,oods CI* - Client Independent *etting

Glossary • • • Overview A *et of Ne Tax condition t"pes ha!e been introduced for Purchase and *ales Process' These ne condition t"pes should be used from /st of April #$$)' • 0efine the tax conditions that are currentl" Non deductible as VAT Non deductible ' This ill enable "ou to address the transition to VAT at a later point of time' This ould help in reporting Taxes on *ales1Purchases for the Tax 2ear #$$)' (or Inbound transactions fi!e ne Tax condition t"pes ha!e been introduced3

4VC*3 A1P C*T Non 0eductible under VAT 4V-03 A1P VAT -. 0eductible 4V-N3 A1P VAT -. Non 0eductible 4VC03 A1P VAT C, 0eductible 4VCN3 A1P VAT C, Non 0eductible • 5ach of the condition t"pe mentioned abo!e should be assigned to a separate Transaction1Account 6e" and a separate ,1L account' This ill help in the period end processing here ind!idual taxes need to be clearl" identified 7 reported' (or e'g' a separate treatment ma" be re8uired for taxes on interstate sale, that could !ar" from state to state'

aintain Condition Categor" as >0>-+Tax+'5nsure the Access se8uence +4*T/+ Note3 5nsure that all the existing Condition T"pes used in Tax procedure TAXINN ha!e the follo ing attributes' These settings are re8uired to or& ithout an" 4urisdiction Code' These changes are applicable from /st April #$$)' This is o!er and abo!e the ne condition t"pes created' "TY2 !" Access *e8uence 3 4*T/ Condition Categor" 3 0 ).0efine Condition T"pes :.Note: Certain settings ha!e to be a!ailable on the production s"stem hen "ou start the transaction for the Tax 2ear #$$)' Those settings are highlighted ith "TY2 !" and "ou should capture these in separate re8uest' "on#iguration Ste$s: 1. .Chec& Calculation Procedure .(inancial Accounting . Create Tax Conditions Types for Sales/Purchases %"IS&: I.Tax on *ales1Purchases .lobal *ettings ? Tax on *ales1Purchases ? 9asic *ettings ? Chec& and Change *ettings for Tax Processing :.9CN= A&e" 0escription Tax T"pe Non 0educt Posting Ind • 4P@3 A1P C*T Non 0eductible # X % .aintain the Access se8uence as >4*T/>' ) Create Condition Type JV$%: A/P VAT $& %educti le as a copy of J!PC . ? (inancial Accounting ? (inancial Accounting . %efine Ne* Transaction +ey for the ne* TA# Conditions:%"IS& I.lobal *ettings .aintain Condition Categor" as >0>-+Tax+'5nsure the Access se8uence +4*T/+ e) Create Condition Type JVCN: A/P VAT C( Non'%educti le as a copy of J!PC .aintain Condition Categor" as >0>-+Tax+'5nsure the Access se8uence +4*T/+ c) Create Condition Type JV$N: A/P VAT $& Non'%educti le as a copy of J!PC .9</= a) Create Condition Type JVCS: A/P CST Non deducti le under VAT as a copy of J!PC for "TA#!NN" ..(inancial Accounting .9asic *ettings.aintain Condition Categor" as >0>-+Tax' ..aintain Condition Categor" as >0>-+Tax+'5nsure the Access se8uence +4*T/+ d) Create Condition Type JVC%: A/P VAT C( %educti le as a copy of J!PC .

0eductible # # 4PA3 A1P VAT -.anual1Automatic :Alternati!e %= ? Alternati!e .. ? (inancial Accounting ? (inancial Accounting .1L Accounts . Non 0eductible # X % . Non 0eductible # X % 4PB3 A1P VAT C..1L Account :Indi!idual Processing= ? 5dit .1L Accounts for all ne Tax transaction &e"s created abo!e' .VAT Pa"able as a Cop" of 4L*T 7 .4P@ :*T in!entor" .• • • • 4P)3 A1P VAT -.4PA :*T in!entor" .eneral Ledger Accounting ? . ? (inancial Accounting ? (inancial Accounting . Chan0e TA#!NN procedure: I.Accounts: I.anuall" :(*$/= Create ne Tax .L Accounts ? Create ..India= 4VC0 . %efine Condition Types: I.India= 4V-0 .1L Accounts .C*T Pa"able 1.India= 4V-N .India= 4VCN . ? (inancial Accounting ? .India= New Pri'ing "onditions in S-.1L Account Centrall" :(*$$= (or *AP -1% @'$93 I. 4VC0..1L Account Creation ? .9@$= Assign appropriate .9<%= • • *elect Procedure TAXINN'Add 4VC*. 4V-0. ? (inancial Accounting ? .VAT Pa"able 4IVC3 A1.1L Account Creation and Processing ? 5dit .4V-N. ? *ales and 0istribution ? 9asic (unctions ? Pricing ? Pricing Control ? .4PB :*T setoff .ethods to Create .lobal *ettings ? Tax on *ales1Purchases ? Posting ? 0efine Tax Accounts :. • The follo ing condition t"pes ha!e to be created' 4IVP3 A1. 4VC* ..1L Accounts to the Transaction &e"s' Note:The 'hanges to the ta( $ro'edure would )e a$$li'a)le #rom *st +$ril 2 /.aintainthe same attribute as in 4L*T' .aster -ecords ? .aster 0ata ? . %efine (/.aintain Condition T"pes :V1$A= Create Condition T"pe 4IVP3 A1.lobal *ettings ? Tax on *ales1Purchases ? 9asic *ettings ? Chec& Calculation Procedure ? 0efine Procedure :..L Account .ne *tep . 0eductible # # 4PC3 A1P VAT C.4PC :*T in!entor" .. and 4VCN in TAXINN immediatel" after 4IPC' Assign Transaction1 Account 6e"s and Alternati!e Calculation t"pe as follo s !.4P) :*T setoff .eneral Ledger Accounting ? . %efine Tax Accounts: I.

lobal *ettings ? Tax on *ales1Purchases ? Posting ? 0efine Tax Accounts :.1L Accounts . %efine (/.C*T Pa"able under VAT as a Cop" of 4L*T 7 .eneral Ledger Accounting? . ? *ales and 0istribution ? 9asic (unctions ? Pricing ? Pricing Control ? 0efine and assign Pricing Procedure ? . %efine Ne* Transaction +ey for the ne* TA# Conditions:%"IS& I..9CN= A&e" 0escription Tax T"pe Non 0educt Posting Ind • • 4NA3 A1.eneral Ledger Accounting ? .VAT Pa"able / # 4NB3 A1.1L Account Centrall" :(*$$= (or *AP -1% @'$93 I.L Accounts ? Create .1L Accounts .9@$= Assign appropriate .1L Account Creation and Processing ? 5dit .aster -ecords ? . ? (inancial Accounting ? (inancial Accounting ..ethods to Create .Create Condition T"pe 4IVC3 A1.1L Account :Indi!idual Processing= ? 5dit . ? (inancial Accounting ? . ? (inancial Accounting ? (inancial Accounting .1L Accounts to the Transaction &e"s' "hange S.anuall" :(*$/= Create ne Tax .Accounts: I.lobal *ettings ? Tax on *ales1Purchases ? 9asic *ettings ? Chec& and Change *ettings for Tax Processing :.. ? (inancial Accounting ? .Pri'ing Pro'edure%s&: +$$li'a)le #rom *st +$ril 2 ! I.1L Accounts for all ne Tax transaction &e"s created abo!e' 4.aster 0ata ? .anual1Automatic :Alternati!e %= ? Alternati!e . 4IVC after 4L*T' in NVV no need to gi!e an" .L Account . %efine Tax Accounts: I.1L Account Creation ? .aintain the same attribute as in 4L*T' 2..aintain Pricing Procedure :V1$C= *elect the rele!ant *0 Procedure' Add 4IVP..C*T Pa"able under VAT / # 3.ne *tep .1L .