SAP CIN - COUNTRY VERSION INDIA
- 1. Business Processes Country Version India
- 2. AGENDA • GLOSSARY • BACKGROUND – CIN • INTERFACE BETWEEN SAP AND CIN • INDIAN LOCALISATION COVERAGE • PROCESSES IN SAP WITH CIN PROCUREMENT SALES FINANCE REPORTS
- 3. GLOSSARY CIN - COUNTRY VERSION INDIA INPUT TAX -Tax that is charged by the vendor. A claim for refund of the deductible portion of input tax can be submitted to the tax authorities OUTPUT TAX -Tax levied on customers at all levels of production and trade. Output tax represents a tax liability. SERVICE TAX - Tax levied on the customer on services specified by the Government. DEPOT - Depot is a plant where the material is stored and sold. There is no manufacturing activity at the depot. The depots when registered with the excise authorities can pass on the Modvat benefits to the customer.
- 4. GLOSSARY EXCISE DUTY (BED) - A quantity-based tax which must be paid when a dutiable material is moved from a duty-free (bonded) location to a duty-paid (unbonded) location or the customer. Also known as excise tax. The excise duty is based on the quantity / Value of material moved. AED – Additional Excise duty is a duty which is calculated over and above the Excise Duty payable on the material. SED – Special Excise Duty is an additional duty levied on certain materials depending on the characteristics of the material. The statute specifies these materials. CHAPTER ID –All materials that are required for manufacturing and subsequently those which are manufactured, are classified under the Central Excise Law into chapters. These chapters are further subdivided into headings and subheadings, which together form the chapter ID. Chapter ID 7216.10 is an example.
- 5. GLOSSARY CVD – Countervailing duty is a levy charged on the imports of materials in lieu of excise duty. CENVAT – Central Value Added Tax. The tax is levied on the difference between the output and the input value. This is also referred as MODVAT. CESS – Cess is a tax imposed for a specific purpose under different acts with reference to certain goods. Cess is levied at the time of removal of goods from the factory. OCTROI – A levy payable on the material to the local authorities. ASSESSABLE VALUE - Denotes the value of goods that you have manufactured in-house at the price as assessed by an authorized auditor. SETOFF – A certain percentage of input tax which is refunded by the government to the manufacturer. This refund does not form part of material cost.
- 6. GLOSSARY INTERSTATE TRANSACTIONS - A transaction where the goods / material are traded between two different states. CONCESSIONAL TAX FORMS – The Government announces tax concessions in excise and taxes on sales and purchase. This can be availed by submitting the forms prescribed by the Government. E.g ‘C’ form , AR4 , CT3. TDS - Tax deducted at source ( Withholding tax) is a form of indirect taxation deducted at the beginning of the payment flow. Generally, an amount is withheld and paid over or reported to the tax authorities on behalf of (as opposed to by) the person subject to tax, the exception being self-withholding tax. If a withholding tax exemption is available, withholding tax is not withheld.
- 7. GLOSSARY REGISTERS – The registers are the books prescribed having specific format under the statute e.g RG23A,RG23D. RETURNS – The prescribed forms having a specified format under the statute e.g. RT12, RG1, ANNUAL RETURN FOR TDS.
- 8. BACKGROUND FIRST VERSION DEVELOPED IN 1996 IN RESPONSE TO NEEDS OF INDIAN CUSTOMERS STANDARD PRODUCT SUPPLIED BY SAP AS AN ADD-ON CONFORMS TO SAP DEVELOPMENT STANDARD (LOOK AND FEEL ETC) SUPPORTED BY SAP DEVELOPMENT LAB AT BANGALORE
- 9. CIN INTERFACE WITH SAP FI SD MM SAP IN CIN FI - INTERFACE COMPONENT INSTALL COMPONENT ACTIVATE COMPONENT ACTIVATE PROCESSES OPEN FI - INTERFACE FI SD MM
- 10. CIN INTERFACE WITH SAP COUNTRY VERSION INDIA INSTALLATION COPIES THE FOLLOWING 1. STANDARD INDIA TEMPLATES 2. TAX PROCEDURE (TAXINJ/ TAXINN) 3. CONDITIONS – EXCISE, TAXES ON SALES & PURCHASE, SERVICE TAX, CVD ETC 4. TABLES , FUNCTION MODULES , NO.RANGE OBJECTS, CUSTOMER EXITS 5. TAX DEPRECIATION KEYS
- 11. INDIAN LOCALISATION COVERAGE COVERS THE FOLLOWING CENTRAL / LOCAL SALES TAX SALES TAX SETOFF PURCHASE TAX CONCESSIONAL TAX FORMS SERVICE TAX OCTROI
- 12. INDIAN LOCALISATION COVERAGE BASIC / ADDITIONAL / SPECIAL EXCISE DUTY MAINTENANCE OF RATES ON VENDOR CLASS MAINTENANCE OF RATES AS PERCENTAGE & AMOUNT UTILISATION OF MODVAT FORTNIGHTLY PAYMENT CVD ( IMPORTS) SUB-CONTRACTING SUB-CONTRACTING CHALLANS RECONCILIATION OF QUANTITIES MAINTENANCE OF 57F4 REGISTER
- 13. INDIAN LOCALISATION COVERAGE MODVAT UPDATING OF PART-I REGISTER FOR QUANTITY UPDATING OF PART-II REGISTER FOR VALUE UPDATING OF RG23D REGISTER FOR DEPOT PRINTING OF EXCISE REGISTERS PART-I / PART-II REGISTERS RG1 REGISTER RT12 RETURN FACILITY FOR DOWNLOAD
- 14. INDIAN LOCALISATION COVERAGE EXTENDED WITHHOLDING TAX WITHHOLDING TAX ON DOWN PAYMENTS / INVOICES / PROVISIONS ACCUMULATIONS MULTIPLE TAX LINE ITEMS IN ONE INVOICE CALCULATION ALTERNATIVES (GROSS, NET, OFFSET) ROUNDING OPTIONS PAYMENT DUE DATES BY BUSINESS PLACE CHALLAN UPDATE AND ACCOUNT CLEARING SURCHARGE ON WITHHOLDING TAX CERTIFICATE NUMBERING FOR DIFFERENT SECTIONS / BUSINESS PLACE CERTIFICATE PRINTING WITH CUSTOMISABLE LAYOUT ANNUAL RETURNS FOR VARIOUS SECTIONS OF INCOME TAX ACT
- 15. PROCUREMENT PROCESS REQUIREMENTS AS PER INDIAN STATUTE 1. CALCULATION OF EXCISE DUTY BASED ON MATERIAL AND CHAPTER ID COMBINATION 2. CALCULATION OF EXCISE BASED ON CLASS OF VENDOR 3. CALCULATION OF INPUT TAX BASED ON INTERSTATE TRANSACTIONS 4. CALCULATION OF INPUT TAX SETOFF ON INCOMING MATERIAL (APPLICABLE TO FACTORY). 5. CAPTURE OF PART I AND PART II FOR CENVAT. 6. SUBCONTRACTING – U/S 57F4 WITHOUT PAYMENT OF EXCISE DUTY 7. SUBCONTRACTING – QUANTITY RECONCILIATION & SETTLEMENT 8. SUBCONTRACTING – PAYMENT OF EXCISE DUTY FOR NONRECEIPT OF MATERIAL AFTER SPECIFIED PERIOD.
- 17. TAX CALCULATION AT PURCHASE 1. TAXES ON SALES & PURCHASE ARE MAINTAINED AT FEDERAL LEVEL AND STATE LEVEL 2. THE EXCISE CONDITION IS MAINTAINED AT 100% 3. THE EXCISE RATE FOR THE MATERIAL IS MAINTAINED IN CIN MASTER. 4. THE INPUT / OUTPUT TAX RATE IS MAINTAINED FOR FEDERAL TAX AND STATE LEVEL TAX CONDITIONS 5. PERCENTAGE OF SETOFF ON INPUT TAX IS MAINTAINED IN SETOFF CONDITION
- 18. HOW TAXES ARE DETERMINED 1. THE CHAPTER ID FROM CIN TABLE FOR THE MATERIAL 2. EXCISE RATE DERIVED FROM CHAPTER ID FROM CIN MASTER 3. IN TAX PROCEDURE 100% OF THE RATE IS CALCULATED 4. THE TAX CODE IS ENTERED IN THE LINE ITEM AND THE JURISDICTION OF THE VENDOR IS ACCETPTED AS AN INPUT., 5. THE CVD IS ENTERED MANUALLY IN THE PRICING SCHEMA.
- 19. PROCUREMENT- LOCAL PURCHASE SAP CIN CREATE PO PRICING GR IV Excise Rate Determination Based on Material / Chapter ID and Vendor Class Simulate & Post Cenvat. Update Part I -Qty Update Part II –Val A/c. Determination This also updates the excise header / line item tables.
- 20. PROCUREMENT- IMPORT PURCHASE SAP CIN CREATE PO PRICING GR Create Excise Invoice for CVD. This is entered manually in Pricing Update Part I - Qty Simulate & Post Cenvat. Update Part II –Val A/c. Determination IV This also updates the excise header / line item tables.
- 21. PROCUREMENT– SUB-CONTRACT SAP CIN CREATE PO TRF. POSTING GR IV Create Sub- Contract Challan w.r.t mat. doc. Print Excise Challan Update Register Settle w.r.t. subcontract challan. Consumes the child material. Updates Register Reconciliation and Completion of Challan This also updates the excise header / line item tables.
- 22. PROCUREMENT– CAPITAL GOODS SAP CIN CREATE PO PRICING GR IV Excise Rate Determination Based on Material / Chapter ID and Vendor Class Simulate & Post Cenvat. Update Part I -Qty Update Part II –Val A/c. Determination 50% - current year 50% - next year. This also updates the excise header / line item tables.
- 23. SALES PROCESS REQUIREMENTS AS PER INDIAN STATUTE CALCULATION OF EXCISE DUTY BASED ON MATERIAL AND CHAPTER ID COMBINATION 1. CALCULATION OF EXCISE BASED ON CONCESSIONAL FORMS. 2. CALCULATION OF OUTPUT TAX BASED ON INTERSTATE TRANSACTIONS 3. MAINTENANCE & PRINTING OF EXCISE / ST. DETAILS OF CUSTOMERS ON INVOICES 4. USAGE OF PRE-PRINTED INVOICE NO. 5. LEVY OF SERVICE TAX ON ALL SERVICES RENDERED FROM FACTORY. 6. PAYMENT OF CESS ON CERTAIN CATEGORY OF MATERIALS (IF APPLICABLE 7. MAINTAINING OF EXCISE RULES
- 24. SALES SCENARIOS FACTORY SALES TAX CALCULATION - SALES 1. TAXES ON SALES & PURCHASE ARE MAINTAINED AT FEDERAL LEVEL AND STATE LEVEL 2. THE EXCISE CONDITION IS MAINTAINED AT 100% 3. THE EXCISE RATE FOR THE MATERIAL IS MAINTAINED IN CIN MASTER. 4. THE INPUT / OUTPUT TAX RATE IS MAINTAINED FOR FEDERAL TAX AND STATE LEVEL TAX CONDITIONS 5. REGIONS ARE MAINATINED AT PLANT / CUSTOMER
- 25. TAXES ARE DETERMINED BY THE SYSTEM 1. THE CHAPTER ID FROM CIN TABLE FOR THE MATERIAL 2. EXCISE RATE DERIVED FROM CHAPTER ID FROM CIN MASTER 3. IN TAX PROCEDURE 100% OF THE RATE IS CALCULATED 4. THE JURISDICTION IS DETERMINED BASEED REGION MAINTAINED IN CUSTOMER MASTER AND PLANT, 5. IF THE REGION IS SAME THEN STATE LEVEL TAXES ARE APPLICABLE ELSE FEDERAL TAXES WILL BE APPLICABLE . THIS IS DETERMINED BY THE ROUTINES IN TAX PROCEDURES. 6. THE TAXES ON SALES AND PURCHASES ARE DETERMINED BASED ON THE TAX CODES
- 26. SALES SCENARIOS – FACTORY SALES SAP CREATE SO DELIVERY PGI BILLING This also updates the excise header / line item tables. CIN Excise Rate Determination Based on Material / Chapter Id / Form type. ST based on Jurisdiction and Tax Codes Excise Inv. WRT SAP Billing Doc. Selection of Rules Update No. Range Update Tables A/c Determination
- 27. REQUIREMENT OF FINANCE WITHHOLDING TAX • • • • • • • ACCUMULATION OF TAX BASE AMOUNT CERTIFICATE NUMBERING BASED ON BUSINESS PLACE AND IT SECTION ANNUAL RETURN FOR EACH SECTION PAYMENT OF WITHHODING TAX CALCULATION OF SURCHARGE CERTFICATE PRINTING SHOWING TAX RATE INCLUSIVE OF SURCHARGE PAYMENT BY DUE DATE EXCISE DUTY • FORTNIGHTLY PAYMENT
- 28. PROCESS OF WITHHOLDING TAX TDS ON PAYMENT TDS ON INVOICE REQUEST FOR DOWN PAYMENT CALCULATE TDS PAYMENT OF REQUEST CALCULATE TDS ACCOUNTING ADJ. FOR DOWN PAYMENT PAYMENT OF TDS UPDATE CHALLAN PRT CERTIFICATE THE TABLES FOR TDS AND CERTIFICATES ARE UPDATED ANNUAL RETURN
- 29. PROCESS FOR PAYMENT OF EXCISE SELECTION OF DATES UTILIZATION SELECTION OF REGISTERS RG23A,RG23C,PLA PAYMENT ACCOUNTING THE TABLES FOR EXCISE ARE UPDATED
- 30. STATUTORY REGISTERS / REPORTS RG23A PART I REGISTER RG23A PART II REGISTER RG23C PART I REGISTER RG23C PART II REGISTER RG1 REPORT RT12 REPORT 57F REGISTER TDS CERTIFICATES REPORT TDS ANNUAL RETURN REPORT ALL THE REGISTERS & REPORTS WITH CUSTOMIZABLE LAYOUT WITH DOWNLOAD FACILITY ARE AVAILABLE AS PART OF STANDARD CIN
- 31. FISCAL YEAR All the statutory reports and registers have to be maintained as per the Government Fiscal Year. The Government Fiscal year starts from 1st of April and ends on 31st of March of the subsequent year. The Income Tax Depreciation has to be calculated on the basis of the Government Fiscal Year basis.
- 32. PSML Business Processes Thank You