Service Tax & VAT

[Former Member]

Dear Friends,

We have a pricing procedure meant for Sale of Services. It has got condition types like Basic price, Service Tax and Cess. Now we have to extend the same pricing procedure for Product sales. we have to maintain VAT and CST for products. Is it a standard practice to have both product and service condition types in a same pricing procedure or do we need to create separate pricing procedure for Services and Products.

If at all I manage with a single Pricing procedure I have to maintain condition record for services with regard to VAT(means for service material VAT will not be applicable. So we need to assign Tax code with 0% VAT for Service material). Otherwise system will pick VAT for Service material during pricing.because VAT is calculated based on Customer and Material classification, not with respect to the Material. This may lead to confusion for an end user.

Is it a standard practice to maintain condition record for VAT with respect to Service material??

Please let me know how to handle this.

with regards,

[Lakshmipathi · Accepted solution]

Is it a standard practice to have both product and service condition types in a same pricing procedure or do we need to create separate pricing procedure for Services and Products.

There is no fixed thumb rule for this.  As long as the Business requirement meets with one pricing procedure, you can restrict to have one pricing procedure.  Anyway, for condition record, I am sure, material code would be different in both the cases and hence, it wont have any impact.

G. Lakshmipathi