Tax classification for foreign countries

[Former Member]

Dear SAP experts,

I would really appreciate your help with the following problem.

As far as I understand, you can only maintain tax classification data for a certain country in the material master, if you have defined plants in this country. Is this really the case?

If this is true, then we have a problem. We want to sell certain goods from Germany to Austria. The goods will be delivered from our German plant. However, we cannot maintain tax classification for Austria, since we don't have an Austrian plant in the sales area. What can we do? Will creating a dummy Austrian plant in our sales area solve the problem?

Thanks in advance for your help,

Alexander.

[vinastik · Accepted solution]

Hi Alexander

The tax data in the material master is relevant to the departure country: in your case this is Germany.

Is the Austrian customer an external customer to your company? If yes, you can define the tax classification in the customer master (billing tab) for country Germany.

For the relevant combination for the tax condition type in VK11, define the the tax code related. For example combination: departure country (GE) x destination country (Austria) x customer tax classification x material tax classification.

In the sales order, the tax code will be determined automatically in the pricing procedure

[Former Member · Accepted solution]

Dear Vinna,

thank you for your quick reply! Yes, the Austrian customers are external.

I am concerned about the following case: for certain materials we might have different tax classifications in DE and AT. As far as I understand you, only the departure country classification is relevant for the tax determination. So, for a certain material I might have full tax in DE and half tax in AT. Since I'm delivering to Austria I wish the Austrian classification to be applied? How can I achieve this?

Changing the classification on the customer level doesn't seem to help, for I want it to depend on material.

Alexander.

[vinastik · Accepted solution]

Alexander

May I know why you don't want to use the classification on customer level?

As far as I know, tax depends on multiple parameters, not only the tax classification in the material master. You can define different tax codes depending on if the sales are domestic or export. And in FTXP, you define which is the tax rates per tax code.

[Former Member · Accepted solution]

Dear Vinna,

because I want the tax to be dependent on materials. Suppose, we have materials M1 and M2. M1 should have classification 1 (full tax) and M2 classification 2 (half tax) for all the customers. How can I achieve this on the customer level?

[vinastik · Accepted solution]

Hi Alexander

What I'm saying is that it is easier and more flexible to play on both material and customer levels.

Some tax condition types have in their access sequences combinations including material tax classification and customer tax classification. In this way the same material could have different tax depending on the country of destination and 2 different materials could have different tax in the same country or in 2 different countries.

Managing different tax codes depending on this combination enables more flexibility than playing only on the material tax classification.

Nevertheless I am not sure that your requirement can be met by the standard.

[jobis · Accepted solution]

Hi Alexander,

You can have different tax conditions assigned in material master. same for customer master too.

then you create condition tables and access as per the logic on which tax is determined.

so, like country of destination/material/customer etc..Then you maintain the tax rate for them.

This is very much feasible under the standard configurations for tax determination in pricing.

Regards

Jobi