SAP CIN-MM Customizing For Tax Procedure-TAXINN

Introduction
In one of the previous articles, taxation procedure for Country version India was discussed in detail. This was basically about the calculation of various types of taxes on sales/purchases and goods movements within India., including excise & custom duties, In the standard SAP system there are two types of Tax Procedure for Country Version India. One is TAXINJ, that is formula based Excise and Sales tax calculation and the other one is TAXINN, which is condition based Technique.

Customizing for Tax Procedure TAXINN

Following is the step by step Configuration setting for Condition based Tax Calculation (TAXINN). Under this configuration setting, Tax Jurisdiction code is not discussed for handling Excise Duty and Sales Taxes.

Access Sequence
Financial Accounting Global Financial Accounting Menu Path: SPRO Check Calculation Basic Setting Tax on Sales / Purchases Setting Access Sequences. Procedure Standard Access Sequence for tax procedure is JTAX & JST1. So we can use these without any modification. But if there is any specific requirement from client we can create a new Access Sequence by copying and modifying the existing one to meet that requirement. Here, I will go with the standard one without any modification.

Condition Type
Financial Accounting Global Financial Accounting Menu Path: SPRO Check Calculation Basic Setting Tax on Sales / Purchases Setting Define Condition Types. Procedure For formula bases Tax Calculations the MM tax conditions alone present in the Tax procedure TAXINN. Setting related to the SD procedure will be carried out only in SD Pricing Procedure and these setting will be totally independent of MM settings. So the tax condition types shown below

are related to MM only and these will form the tax procedure TAXINN only. Here, I would also like to highlight that tax condition used in procedure TAXINN is not the same as we use in the procedure TAXINJ.

MM Excise Conditions:
JMOP JMOQ JAOP JAOQ JSOP JSOQ JMIP JMIQ JAIP JAIQ JSIP JSIQ JMX1 JAX1 JSX1 JMX2 JAX2 JSX2 JECP JECI JEX1 JEX3 IN: BED setoff % IN: BED setoff Qty IN: AED setoff % IN: AED setoff Qty IN: SED setoff % IN: SED setoff Qty IN: BED inventory % IN: BED inventory Qt IN AED inventory % IN AED inventory Qty IN SED inventory % IN SED inventory Qty IN: A/P BED setoff IN: A/P AED setoff IN: A/P SED setoff IN: A/P BED inventor IN: A/P AED inventor IN: A/P SED inventor IN:A/P e-cess setoff IN: Eces inventory IN: A/P ecs setoffT IN: A/P ecs invT

LST/CST/VAT Conditions
JIPS JIPC JIPL JIP5 IN Sales tax setoff IN C Sales tax inv. IN L Sales tax inv. A/P RM Deductible

Service Tax Conditions

JSRT JEC3 A/P Service Tax A/P ECS for ST

Tax Procedure Setting

Financial Accounting Global Financial Accounting Menu Path: SPRO Check Calculation Basic Setting Tax on Sales / Purchases Setting Define Procedures. Procedure Tax calculation procedures TAXINN containing the necessary specifications with grouping of above mentioned tax condition types, for the purpose of calculation and posting of taxes on sales/purchases have already been defined in the standard SAP system for Country Version India. The latest changes of Educational CESS and VAT needs to be added to the TAXINN procedure.

Account Key Setting

Financial Accounting Global Financial Accounting Menu Path: SPRO Check Calculation Basic Setting Tax on Sales / Purchases Setting Check and Change Setting for Tax Processing. Procedure The following are the standard account keys used in the TAXINN procedure. In addition to these, if required, new account keys can also be created by copying the existing one and same needs to be assigned to the procedure.
ESA ESE VS1 VS2 VS3 NVV VS5 Output acquisitn tax Input acquisitn tax Sales tax 1 Sales tax 2 Sales tax 3 Non-d.input tax dist Input Tax PST Gross

Assignment of Tax Procedure to Country

Financial Accounting Global Financial Accounting Menu Path: SPRO Check Calculation Basic Setting Tax on Sales / Purchases Setting Assign Country to Calculation Procedure. Procedure
Country IN - Tax procedure TAXINN

Maintaining Excise Defaults

Tax on Goods Logistics General Menu Path: Materials Management Determination of Excise Duty Basic Settings India Movements Maintain Excise Defaults

Formula-based excise determination

If formula-based excise determination is used, define the tax procedure TAXINN and all pricing condition types used for calculating excise taxes, here it is always recommended that these values (purchasing and sales condition types) should be updated in consultation with SD consultants. Following needs to be specify under this activity:

Basic excise duty, Additional excise duty, Special excise duty, Cess Conditions in the sales order that are used for excise rates. Countervailing duty condition type used for import purchase orders.

Condition Based Excise Determination

If condition-based excise determination is used, fill out the CVD cond. field and leave all the others blank in the above mentioned activity. For using condition based Excise Determination define the input tax codes for country India and procedure TAXINN and assign the same to the company code by using the following menu path:

Defining Tax Codes

Tax on Goods Logistics General Menu Path: Materials Management Determination of Excise Duty Basic Settings India Movements Define Tax Codes for Purchasing Condition Based Excise Determination Documents

Assignment of Tax Code to Company Codes

Tax on Goods Logistics General Menu Path: Materials Management Determination of Excise Duty Basic Settings India Movements Assign Tax Code to Company Codes ConditionBased Excise Determination On completion of above settings in SPRO the MM part of tax calculation procedure TAXINN is complete.