Excise Duty Pass on Scenario – By Nireesh.P.H
Below depicts a typical dealer invoice scenario in India.
B is a dealer and purchase materials from its principal A by paying Base amount (say Rs 100 ) & Excise duty (say BED 12%, Ecess 2% & SEcess 1%), comes to Rs 115 and applicable VAT (say 5%)on it . Thus landed value comes to Rs 120.75. Again B sells this material to a manufacturer C for a base amount (say Rs 125) and pass on the excise value he paid to A (Rs 15,ie Rs 125 + 15 =140) and applicable VAT (say 5%) on it. Thus landed value comes to (Rs 140 + Rs 7 =147).
This document explains how C (manufacturer) can handle this scenario in SAP:
Scenario1: ED Set off & VAT inventory
1. Create a PO using T code ME21N
In the Gross price field input the value (Base amount (125) + Passed on ED value (15) = Rs 140). Input applicable VAT tax code (inventory )under invoice tab.Tax code VB= VAT 5%
Total landed value of the PO will be ( Gross price (Rs140) + VAT value( Rs 7) = Rs147)
2. Goods receipt using T code MIGO
Create Goods Receipt with reference to the PO, input details like, QTY, Storage location, Delivery note details, Batch etc. Then click on Excise Tab and input, Excise invoice details and date.
If going for single step posting select Capture & Post. Otherwise select the option Capture and do the posting in J1iex.
You will get the following screen and click on “Miscellaneous” tab and check the MRP indicator
Under item details click on Excise item and
Base value will be populated from the PO.
Edit the base value manually as per the Excise invoice and input values against BED, ECS & SEcess accordingly
Post the document
3. Invoice verification MIRO
Carry out invoice verification with reference to the PO
Base amount (Rs 140 ) will be populated from PO, edit the value manually to value booked under stock of materials during GR (Rs132, ie 125 +7). In header under Basic data, select any ED set off Tax code, input total amount(Rs147) under Amount, ED value(Rs 15) under Tax amount. Input same Tax code in item level also.
Simulate & Save
Accounting document will be:
Scenario2: If both Excise duty and VAT is set off then following method needs to be adopted:
Create PO with VAT set off Tax code
During MIGO edit the base value and input appropriate values against BED, ECS & SEcess
Account Posting will be:
Here VAT value (Rs7) is not added to Stock value as it is SET OFF. Excise posting will be same :
During Invoice verification MIRO:
Edit the value manually to value booked under stock of materials during GR (Rs 125) In header under Basic data, select any VAT set off Tax code, input total amount(Rs147) under Amount, VAT value(Rs 7) under Tax amount. Input same Tax code in item level also.
Select GL account Tab and put the GL code of ED(Centvat Clearing) and put any ED set off tax code and input the the ED value (Rs15)
Simulate and save
Looking Forward for your feedback and suggestions………..