Tax determination in SAP TM
Today we shall discuss the functionality as how tax determination process works when settlement documents are transferred from TM to ECC.
There are two configurations-one at business partner side and other at charge type which enables SAP TM to determine tax code in ERP when the settlement documents are saved and transferred to ERP.There is a tax influencer concept which is transfererd to ERP and this transfer is valid for below enclosed documents:
a) FWSD ( forwarding settlement document ) applicable for LSP scenario
b) FSD applicable for both LSP and shipper scenario
Since in the invoice integration process between TM-ECC, the account detremination and tax calculation always happens in ERP, hence tax code and tax calculation uses the condition type concept to determine the tax value.Although this is a standard procedure in ERP but below enclosed is the process followed for determining taxes:
i) Tax conditions in the pricing procedure of SD/MM module in ERP
ii) Tax conditions via access sequence which enables tax code determination
iii) Access sequence in addition to TM passed parameter helps to determine tax code in ERP
Before we discuss about the configuration and master data required to set up the above process let me highlight the various scenarios where this functionality can be used.
On a LSP scenario once the product/cargo item reaches to customer base don the forwarding agreement, the LSP bills the customer for the entire execution of transportation service. However the customer is also supposed to pay tax on the net amount billed by LSP as per the country and regional laws.
Similarly on the freight settlement side when the carrier sends the invoice to the shipper or LSP for payment of the transportation service rendered by them, the tax amount can also be included on the basis of the net amount charged by carrier. This amount when transferred to ERP the tax influencer parameter will be able to do the tax determination in ERP.
In SAP TM, tax determination occurs at 2 levels a) Charge item level b) charge line level
Below enclosed is the configuration to be done so that this functionality can be implemented.
a) Define tax type and tax group per country in SAP TM-Tax types in TM are condition types in ERP to determine tax and tax groups are classification indicators in SAP ERP.The config node is SPRO-Cross application components-SAP BP-BP-Basic settings-Tax type and tax group ( updated in attachment-Screenshot 1)
b) For forwarding settlement process, we can update in Transaction BP in TM if the specific business partner is to be set up per country and respective tax classification indicator.All this values are maintained under control data tab in Tcode BP in TM.This will help to transfer the payer settings from FWSD to ERP .
c) Define BP tax type and tax groups under SPRO-SAP TM-TM-Settlement-Tax as shown in screenshot 2.
Here the 1st config is to define tax at charge type level for countries-Here we need to activate the country for which tax activation has to be done.
2nd config is to define tax for charges -Here tax type and tax group define dabove needs to be maintained per charge type per country for which we have activated the tax determination at charge type level.
Based on above setting when FWSD is saved and transferred to ERP, this will trigger SD billing document with each charge line in the FWO represents one billing item.
Similarly when FSD is transferred to ERP, tax group info will be passed for each charge type to service line during PO/service entry sheet creation in ERP.
Always remember the tax type and tax group are transfered from SAP TM to ERP for each charge line.
Similarly in ERP side under SPRO-Integration with other SAP components-TM-Invoice integration-Tax, we need to assign TM tax type and tax group to ERP tax classification indicator.