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VAT

Former Member
0 Kudos

Hi,

Hows VAT posted? I want to know how VAT incurred during procured is treated?

regards

B Shar

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
0 Kudos

Hi,

When we Procure goods from a vendor who is with in the state VAT is Applicable & we have to select the appropriate tax code while creating PO. Normally we assign a seperate GL a/c for VAT in transaction OB40. In T.code OBCN we define whether we want the tax to be considered as a seperate line item or not.

In MM we process VAT during Bill Passing (i.e while doing MIRO), the Vendor will be credited the whole amt including VAT. Since we can claim the VAT which we payed on a raw material during purchase we will take the input credit and post it to a seperate GL but in the case of CST its not possible.

Award Points if useful.

Thanks,

Answers (3)

Answers (3)

Former Member
0 Kudos

Hi.

VAT - is Value Added Tax ( It is made as a condition ttype in Tax procedure)

If you have to avail credit then it is assigned a seperate G/l account and a new line is generated.

But if you have to add it has material cost then you have to make a seperate condition type and assign transaction key NVV.

Regards,

vijay

Former Member
0 Kudos

Hi

''''If you have to avail credit then it is assigned a seperate G/l account and a new line is generated.

But if you have to add it has material cost then you have to make a seperate condition type and assign transaction key NVV.''''

Can u explain it?

' a new line is generated' I am not getting this. I understood to avail cdt a separate g/l shd be there? If i want to avail cdt also , a new condition type has to defined and g/l account to be created for TE

regards

B Shar

Former Member
0 Kudos

Hi,

Check OBCN transaction. Here we will specify your transaction Key for taxes which are deductible & non deductible & also we will define whether we want it as a seperate line item or we have to distribute it to material cost.

Thanks & Regards,

Former Member
0 Kudos

Hi,

In Tax Procedure maintain the condition type for VAT.

Create a Transaction key as Input Tax and assign this key in Tax Procedure against the condition type.

In OB40,assign the G/L account to the Transaction Key.

Give the setoff value to the condition type in FTXP for your tax code.

VAT is a income tax which must be paid to the government.

Regards

0 Kudos

VAT - value added tax.It is treated as a separate condition types in Tax procedure.It may be deductible or

non deductible tax accoding to the business requirements. If it is a deductible tax, then it will hit the separate GL accounts, which is assigned to the TE key - Condition type. For non deductible tax, it will added to the material costs. Vat also depends on the material procured like raw material or capital goods.