CIN - Country India Version - Excise Duty Configuration Steps:

Brief Introduction:

 

Country India Version (CIN) is designed for use by business with operations in India. It contains a localization implementation guide (IMG), and a country template to help us customize the system according to local requirements. This is over and above the generic SAP system functionalities. Most of the country-specific functions for India relate to Financials and Logistics, and center around taxes, including:

 

o        Excise duty and the central value-added tax system (CENVAT)

o        Tax deducted at source (TDS)

o        Sales tax

 

 

Activate Country Version India for Specific Fiscal Years:

 

In this activity, we specify for which fiscal years we want to activate Country Version India for the accounting interface.

 

Menu Path: Financial Accounting (new) --> Financial Accounting Global Settings (New)--> Tax on Sales/Purchases --> Basic Settings --> India --> Activate Country Version India for Specific Fiscal Years

 

Transaction Code: SPRO

 

 

Basic Settings:

 

We maintain the data relating to excise registrations. Excise registration is an entity in India that is entitled by law to produce any goods liable to excise. Each entity is assigned its own excise registration number. For example every factory that manufactures excisable goods is required to register separately, so that a business with seven factories requires seven registrations. Each of the excise registrations needs to be specified by a four-character code.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain Excise Registrations

 

Transaction Code: SPRO

 

 

Maintain company code settings:

 

Maintain the standard defaults for the company code.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain company code settings

 

Transaction Code: SPRO

 

Maintain Plant Settings:

 

Maintain the excise information relating to the plants.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain Plant Settings

 

Transaction Code: SPRO

 

Maintain Excise Groups :

 

Here we define the excise groups. An excise group is a unit within an excise registration, in India, which keeps its own set of excise records. Whereas the excise registration reports to the excise authorities, the excise group is a purely internal organizational unit. Each excise group keeps records of all transactions that have to be reported to the excise authorities. When the time comes to present these records to the authorities, the excise registration compiles the information from all of its excise groups. For each excise group, we can also control how various excise invoice transactions will Work.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain Excise Groups

 

Transaction Code: SPRO

 

Maintain Series Groups :

 

Series groups allow maintaining multiple number ranges for the outgoing excise documents. Based on excise regulations and exemptions from the authorities we can maintain multiple number series for outgoing documents. But each of these series has to be declared to the excise authorities.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain Series Groups

 

Transaction Code: SPRO

 

Maintain Excise Duty Indicators:

 

Here we maintain the excise duty indicators. This determines the effective duty that would be used for excise duty calculations. Generally, no change to the standard settings is required.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Maintain Excise Duty Indicators

 

Transaction Code: SPRO

 

Maintain Postal Addresses:

 

The addresses of various customs and excise organizations that the company deals with are maintained here. These addresses are used in the ARE Documents functions. When an ARE-1 or ARE-3 document is created, the address of the excise department and the customs department involved in the export process are entered. The system then prints their names and addresses on the AREs.

 

A default local excise department for each excise group and a default customs department for each series group can be defined.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings --> Maintain Postal Addresses

 

Transaction Code: SPRO

 

Maintain Sub Transaction types :

 

By default, the system records excise duties on the accounts that have been specified in the IMG activity "Specify Excise Accounts per Excise Transaction". However, if we want to be able to record some excise duties on other accounts we need to create a sub-transaction type in this IMG activity.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings --> Maintain Sub Transaction types

 

Transaction Code: SPRO

 

Select Tax Calculation Procedure:

 

For country India we need to specify which tax procedure we would use to determine excise duties and sales taxes on input materials.

 

o        For condition-based excise determination, use TAXINN or a copy of it

o        For formula-based excise determination, use TAXINJ or a copy of it. This tax procedure also supports condition-based excise determination, so that we can work with both concurrently.

 

It is recommend that for new implementations we use condition-based excise determination. Note that once a tax procedure is already used and documents posted, it is difficult to switch to another one, as the old documents will not be displayed.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings --> Determination of Excise Duty --> Select Tax Calculation Procedure

 

Transaction Code: SPRO

 

Maintain Excise Defaults:

 

Here we define which tax procedure and pricing condition types are used in calculating excise taxes using formula-based excise determination (TAXINJ or a copy of it). If condition-based excise determination is used (TAXINN or a copy of it), maintain the CVD condition field and leave all the others blank.

 

If formula-based excise determination is used (TAXINJ or a copy of it), maintain the following:

o        Tax procedure and the pricing conditions that are relevant for excise tax processing.

o        The purchasing and sales conditions types used for basic excise duty, additional excise duty, special excise duty, and Cess.

o        The conditions in the sales order that are used for excise rates.

o        The countervailing duty condition type used for import purchase orders.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Determination of Excise Duty --> Maintain Excise Defaults

 

Transaction Code: SPRO

 

Define Tax codes for Purchasing Documents:

 

Maintain tax codes for the purposes of calculating excise duty when creating purchasing documents.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Determination of Excise Duty --> Condition Based Excise Determination --> Define Tax codes for Purchasing Documents

 

Transaction Code: FTXP

 

Assign Tax code to company code:

 

Assign the tax code for purchasing documents to the company codes where it will be used. This is only required if you condition-based excise determination is used.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings--> Determination of Excise Duty --> Condition Based Excise Determination --> Assign Tax code to company code

 

Transaction Code: SPRO

 

Classify condition types:

 

Here we specify which condition types are used for which sort of tax. Note that this only applies to condition types that are used with the new excise determination method (TAXINN). The system uses this information when a document is creating from another one. For example, when an incoming excise invoice is created from a purchase order, or when an outgoing excise invoice is created from a sales order, the system determines the various excise duties in the excise invoice using the information that have been entered here. In addition, when a purchasing document is created, the system only uses the condition types that are entered here.

 

o        For taxes on purchases, use the condition types contained in the tax procedure

o        For taxes on sales, use the condition types contained in the pricing procedures.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Basic Settings --> Determination of Excise Duty --> Condition Based Excise Determination --> Classify condition types

 

Transaction Code: SPRO

 

Maintain Chapter Ids :

 

Maintain the chapter IDs and the corresponding descriptions as per the schedules published by the Central Board of Excise and Customs.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Master Data -->Maintain Chapter Ids

 

Transaction Code: SPRO

 

Assign Users to Material Master Screen sequence for Excise Duty:

 

Here we customize the material master data so that it shows the information relating to excise duty. Country Version India comes with a screen sequence (IN) that shows the excise duty fields. We need to assign it to each of the relevant users under User Screen Reference.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Master Data --> Assign Users to Material Master Screen sequence for Excise Duty

 

Transaction Code: SPRO

 

Define Form Types:

 

Define which form types needs to be recorded in the system. This is used for form tracking for the form types that are maintained.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Master Data --> Define Form Types

 

Transaction Code: SPRO

 

Define GL accounts for taxes:

 

Here we specify which G/L accounts to use to record account postings for taxes. We have to set up G/L accounts for each of the processing keys listed below. The accounts for VS1, VS2, and VS3 are used as clearing accounts during excise invoice verification.

 

  • VS1 (basic excise duty)
  • VS2 (additional excise duty)
  • VS3 (special excise duty)
  • VS5 (sales tax setoff)
  • MWS (central sales tax)
  • MW3 (local sales tax)
  • ESA (service tax)
  • ESE (service tax expense)

 

 

Account Determination:

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Account Determination --> Define GL accounts for taxes

 

Transaction Code: OB40

 


Specify Excise Accounts per Excise transaction:

 

Here we specify which excise accounts (for excise duty and CENVAT) are to be posted to for the various transaction types. Maintain all the accounts that are affected by each transaction type. If sub-transaction types are used then, maintain the accounts for each sub-transaction type as well.

 

Transaction type UTLZ is used for determining accounts only while posting excise JVs and also if the payment of excise duty has to be done fortnightly. The fortnightly CENVAT payment utility picks up the credit side accounts from the transaction types of GRPO, EWPO, and TR6C for determining the CENVAT and PLA accounts. There is no separate transaction type for fortnightly payment.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Account Determination --> Specify Excise Accounts per Excise transaction

 

Transaction Code: SPRO

 

Specify GL Accounts per Excise transaction:

 

We assign the excise and CENVAT accounts to G/L accounts in this step. While executing the various transactions, the system determines which G/L accounts to post to by looking at the:

 

Excise group

Company code

Chart of accounts

 

If separate account determination settings within an excise group are required, we use sub transaction types.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Account Determination --> Specify GL Accounts per Excise transaction

 

Transaction Code: SPRO

 

 

 

Business Transactions --> Incoming Excise Invoices

 

Select Fields:

 

Specify which fields are required in the Incoming Excise Invoices transaction. The settings that are made here apply for all versions of the transaction. For each field, we need to specify whether it is to be an input field, a display field, and so on. It is also possible to highlight fields of particular importance.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Select Fields

 

Transaction Code: J1IEX_SFAC

 

 


Define processing modes per transaction:

 

Specify which processing modes the user can use in the various Incoming Excise Invoice transactions. This way, we can customize the transaction to what the end users have to do.

 

Standard settings - The system comes with three standard transactions relating to the Incoming Excise Invoices function (those that are included in the role SAP_CIN). The processing modes available in these transactions are as follows:

 

  • J1IEX_C - This transaction is for excise clerks: users of this transaction can only capture and display excise invoices.
  • J1IEX_P - This transaction is for excise supervisors: they can change, display, cancel, and post excise invoices.
  • J1IEX - In this transaction, users can capture and post excise invoices, as well as displaying, changing, and canceling them.

 

If the standard setting does not meet business requirements, adjust the standard settings or you can create custom transactions. To do so, in Maintain Transaction, we create a new transaction by making a copy of one of the standard transactions. Give the new transaction a transaction code. Enter data as follows:

 

  • Transaction code - The transaction code that is created.
  • Processing mode - Specify which users of the transaction will do with the excise invoices.
  • Active - Select this indicator to activate the setting.

 

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Define processing modes per transaction

 

Transaction Code: SPRO

 

 

Define reference documents per transaction:

 

For each combination of transaction and processing mode which reference documents the users to be able to use. Activate each entry for it to work.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Define reference documents per transaction

 

Transaction Code: SPRO

 

Maintain rejection codes :

 

Define the rejection codes that are to be used in the Incoming Excise Invoices transaction. For each rejection code, enter a code and a description. It can also be specified whether the excise duty in the invoice is to be posted to the CENVAT on hold account, instead of the CENVAT clearing account.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Maintain rejection codes

 

Transaction Code: SPRO

 

 

Specify which movement types involve Excise Invoices:

 

Specify which movement types relating to goods receipts involve excise invoices. The system uses this information during the goods receipt procedure. When a goods receipt is posted using one of the movement types that is specified here, the system prompts to enter the excise invoice number.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Specify which movement types involve Excise Invoices

Transaction Code: SPRO

 

Excise Invoice capture against delivery in the background:

 

Select the method of processing Excise Invoices for a particular combination of Plant and Vendor, in the Supplier Self Service system (SRM-SUS). In the table J_1I_BCKEXCSUS, we can process Excise Invoices using the following methods:

 

  • Background Processing - Set the Create Excise Invoice Automatically indicator to yes for a particular combination of Plant and Vendor. In this case, the SRM-SUS system automatically processes the Excise Invoices in the background.
  • Manual Processing - Set the Create Excise Invoice Automatically indicator to No for a particular combination of Plant and Vendor. In this case, processing of Excise Invoice takes place manually. The processing can be done using transaction J1IEX.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Incoming Excise Invoices --> Excise Invoice capture against delivery in the background

 

Transaction Code: SPRO

 

Business Transactions --> Outgoing Excise Invoices:

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Outgoing Excise Invoices --> Pricing Procedure for Factory

 

 

Assign billing types to Delivery types:

 

Here we specify which billing document types you use as a reference for CENVAT utilization and assign them to the appropriate delivery document types

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Outgoing Excise Invoices --> Assign billing types to Delivery types

 

Transaction Code: SPRO

 

 

Maintain default excise group and series group:

 

Here we specify which excise group and series group is to appear in these fields by default. We can make separate settings for different combinations of sales organization, distribution channel, division, and shipping point.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Outgoing Excise Invoices --> Maintain default excise group and series group

 

Transaction Code: SPRO

 

 

 

Business Transactions --> Subcontracting

 

Subcontracting Attributes:

 

The subcontracting attributes help determine conditions for a combination of an excise group, a transaction type, and a sub-transaction type. The conditions such as the number of excise items per subcontracting challan, if the non-excisable materials have to be filtered or not when the subcontracting challan is created, the movement type groups for issues and receipts and the hierarchy of determining the excise base value are mentioned here.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Subcontracting --> Subcontracting Attributes

 

Transaction Code: SPRO

 

 

Maintain movement type groups:

 

Here we group movement types together to form movement type groups. Movement Type Groups will be used to club the movement types based on their nature (issues or receipts).

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Subcontracting --> Maintain movement type groups

 

Transaction Code: SPRO

 

 

 

Business Transactions --> Exports under Excise Regulations

 

Make settings for ARE-1 procedure:

 

The settings that control how the ARE documents transaction works for ARE-1s are maintained here. These settings apply to exports under bond and exports under claim for rebate. The system can be configured differently for different series groups.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Exports --> Make settings for ARE-1 procedure.

 

Transaction Code: SPRO

 

Make settings for ARE-3 procedure:

 

The settings that control how the ARE documents transaction works for ARE-3s are maintained here. These settings apply to deemed exports only. The system can be configured differently for different series groups.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Deemed Exports --> Make settings for ARE-3 procedure

 

Transaction Code: SPRO

 

Maintain License types:

 

The license types that are to be used are maintained here. License types are used when we maintain the customers' deemed export licenses: Whenever a license is maintained, we need to specify which type it is.

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Deemed Exports --> Maintain License types

 

Transaction Code: SPRO

 

Maintain output type

 

We define an output type for printing ARE-1s and ARE-3s from the ARE documents transaction. We specify which program, FORM routine, and form is required to print the documents. The system comes with an output type already configured, J1IB (Excise Bonding) for printing the ARE Documents transaction.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Printouts of ARE documents --> Maintain output type.

 

Transaction Code: M706

 

Specify printers:

 

We maintain a printer for each storage location. If there is a requirement for the system to print the ARE documents immediately, we choose Print in the ARE documents transaction, and select "Immediately".

 

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Printouts of ARE documents -->Specify printers

 

Transaction Code: OMJ3

 

Define processing modes per transaction:

 

Please refer to the section on "Incoming Excise Invoices ® Define processing modes per transaction", (the underlying logic is the same). We specify which processing modes the user can use in the various ARE document transactions. This way, we can customize the transaction to what the end users have to do.

 

Standard settings - The system comes with eight standard transactions relating to the ARE document function (those that are included in the role SAP_CIN). The processing modes available in these transactions are as follows:

 

Processing mode                                        ARE-1s             ARE-3s

Create, change, update, cancel, display             J1IA101             J1IA301

Create, change, display                                     J1IA102             J1IA302

Update, display                                                 J1IA103             J1IA303

Cancel, display                                                 J1IA104             J1IA304

 

 

Separate transactions have been created to allow distinguishing between users who can only create AREs and those who can update them, which requires more skill and knowledge of the CENVAT processes.

 

Cancellation has been assigned a transaction of its own. Managers and administrators can use the central transactions with authorization for all processing modes.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Transaction configuration --> Define processing modes per transaction

 

Transaction Code: SPRO

 

Define reference documents per transaction:

 

For each combination of transaction and processing mode which reference documents the users to be able to use. Activate each entry for it to work.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Transaction configuration --> Define reference documents per transaction

 

Transaction Code: SPRO

 

Maintain rejection codes :

 

Define the rejection codes that are used in the ARE Documents function. For each rejection code, maintain a code and a description. The third field need not be used.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Exports Under Excise regulation --> Transaction configuration --> Maintain rejection codes

 

Transaction Code: SPRO

 

 

Business Transactions --> Utilization

 

Utilization Determination:

 

In this customizing we specify which CENVAT accounts are to be debited by the Fortnight Utilization of CENVAT report: When the report calculates how much excise duty to be remitted, it automatically proposes which CENVAT accounts the duty should be debited to. We specify those defaults here. We can

 

o        Either debit all the excise duty to one account or

o        Debit the excise duty to more than one account, in which case we specify which percentage is to be debited to each account

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Utilization --> Utilization Determination

 

Transaction Code: SPRO

 

Maintain Minimum Balance for Excise accounts:

 

Maintain minimum balances in the excise accounts. When the balance in these accounts during utilization falls below this level, the system automatically utilizes funds in the PLA account.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Utilization --> Maintain Minimum Balance for Excise accounts

 

Transaction Code: SPRO

 

 

Business Transactions --> Excise register

 

Specify SAP script forms:

 

For each of the company codes, we specify which SAPscript forms the system prints the excise registers with.

 

The layout description can be left blank or an appropriate description maybe filled in. Custom layouts and names can be maintained here (preferably make a copy of the standard). If the output device and number of copies are maintained it is automatically picked up for printing.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Business Transactions --> Excise Register --> Specify SAP script forms

 

Transaction Code: SPRO

 

 

Tools

 

Long Texts:

 

Define the different types of long texts that is required for the various excise transactions. There is no limit to the number of types of long texts. For each long text, we need to specify which transactions the long texts are for.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Tools --> Long Texts

 

Transaction Code: SPRO

 

Number Ranges:

 

Maintain the number ranges for all CIN Number range objects using this transaction. The number range number has to be '01' for all.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Tools --> Number Ranges

 

Transaction Code: J1I9

 

Message Control :

 

Here we specify whether a given message should appear as a warning message or an error message. Maintain each message, specifying whether it should apply to one user or all users.

 

Menu Path: Logistics – General --> Tax on Goods Movement --> India --> Tools -->

Message Control

 

Transaction Code: SPRO

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