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Former Member

Scrap Sales for SD TCS is to be configured as a withholding tax in the SD

Hello Experts

I know the topics has been discused previously but going through previous threads , has confused me further .

Going through previous threads , it seems that now ( FROM ECC 6.00 ) it has become FI + SD configuration .

I went through Note 1168591

TCS will have to be configured in the sales pricing procedure. TCS is to be configured as a withholding tax in the SD ?? ( Withholding Tax is used for Vendor Payments where tax to be remitted to govt is with held by customer , why in Sales ?)

Plz help to make me understand following

Requirement is for ECC 6 and ECC 4.7

1. Configure Scrap Sales for Excisable and VATable Goods .

2. Configure Scrap Sales for Non Excisable but VATable goods .

3. Plz provide simple steps to be done from SD side and what needs to be done from FI side .

4.Account determination for TCS , since this is TAX condition type , Category D , so OB40 should be used , not VKOA ?

Plz Explain in Simple terms with clarity



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  • author's profile photo Former Member
    Former Member
    Posted on Aug 31, 2013 at 05:41 PM

    Dear Rohit Bahl,

    The Steps for the Tax collected at source scenario is as follows:

    1. Withholding Tax key has to be maintained in FI Withholding Tax, for Example 206C
    2. Withholding Tax Types has to be maintained in FI, make sure that base amount will be modified net amount
    3. Create Condition table in SD, for Example 399- Withholding Tax, country
    4. Create an Access Sequence in SD J1AW and assign the condtion table
    5. Create a condition type in SD for Tax Base and category of condition will be D
    6. The Tax Type mentioned at point 2 should be assigned to condition type created in point 5, the Assignment is made in FI in Withholding Tax configuration
    7. Create tax codes in FI for withholding Tax and mention the rate
    8. Since posting will happen from SD as well from FI with TDS code, offsetting concept posting is used for TCS tax type, so assign tax for transaction OFF
    9. Same GL should be assigned to transaction WIT
    10. Condition type created in point 5 has to be added in the pricing procedure.
    11. Account Assignment in VKOA

    Maintain all the above settings to run TCS process.


    Lakhbir Singh

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    • Former Member Former Member

      Dear Rohit,

      TCS values flow from SD side to FI side and the same needs to be paid in challan and reported in

      quartely returns, hence to enable all these processes and for it to work like a normal FI document

      after the SD side processing is over, we need to configure tax type tax codes for TCS.

      I hope this is what you are looking for.

      You haev to maintain conditions as well as the tax type tax codes for TCS so as to enable smooth flow of value from SD side to FI side for further processing.



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