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Former Member

Exclude one customer from VAT

Hi ,

Ours is french company.

For all French customers we are charging vat of 19.6% where as we have one customer who is in the border of France for this customer VAT is not applicable.

Still as per conditions its calculating VAT for this customer also.

Pls tell us how to exclude VAT for this customer.?

regards

Rajendar G

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2 Answers

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    Former Member
    Mar 13, 2010 at 03:43 PM

    Hi,

    In the customer master XD02 for that customer at the BILLING DOCUMENT Tab Maintain the Tax exemptt indicator as 0 in the classification field

    Please maintain it

    regards,

    santosh

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    Former Member
    Mar 13, 2010 at 05:51 PM

    Hi,

    This is how the tax works in SAP.

    You have 2 methods of classifications for tax.

    1- Customer Tax classification - By maintaining 1 or 0 in the customer master/ Billing documents tab under Tax classification section you can say whether customer is taxable or not.

    1 - if the customer is taxable

    0 - if customer is tax exempt

    2- Material Tax classification - By maintaining 1 or 0 in the material master/ sales tab, under Tax classification section you can say whether material is taxable or not.

    1 - if the customer is taxable

    0 - if customer is tax exempt

    Now come to VK11 condition record for that tax (Eg: VAT)

    your VK11 record goes for this combination. (Format)

    Customer Tax classification - Material Tax classification - Tax percentage

    1 - 1 - 19.6%

    1 - 0 - 0%

    0 - 1 - 0%

    0 - 0 - 0%

    As per the above example, Customer and Material both should be taxable, in order to apply the VAT.

    Now coming back to your question, what you can do it for that particular customer, maintain "0" under tax classification.

    Then in VK11, maintain "0 - 1 - 0%" as well.

    So that sales order won't pick 19.6%.

    Thanks and best regards,

    Anupa

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    • Former Member Former Member

      Hi,

      You mean when you go to the transaction XD02 for that customer, and then go to Sales area Data. Then go to Billing Documents tab.

      There you can see a section called "Taxes". Under that please check whether you can select "0" as the Tax classification for that customer for country FR for tax category VAT.

      If you can't see "0 - Tax Exempt" under Tax classification, ask your FI consultant to configure it for you. Then assign that to the customer as i mentioned earlier.

      Then make sure you have the condition master record for the 0 - 1- 0% combination in VK11.

      Then try with a fresh sales order. You should be able to get 0% VAT for that customer.

      Thanks and best regards,

      Anupa