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Hello,
1. The invoice has to be paid in a foreign currency, so the rule is there is no VAT charged.
2. Are you the consultant or a user at your company?
3. Other clients use a special VAT tax code and then execute the sales tax report. Then manually enter the VAT % value against the GL account that is used for VAT adjustments. Note it important to enter the tax code during the posting.
Kind Regards and Thanks
Waza
From: Mag Sai via sap-log-mm [mailto:sap-log-mm@Groups.ITtoolbox.com]
Sent: Thursday, 29 July 2010 11:34 PM
To: wnash7658
Subject: [sap-log-mm] China - Custom Tax, VAT Tax Handling
Posted by Mag Sai
on Jul 29 at 11:53 AM
China - Custom Tax, VAT Tax Handling
Hi SAP friends
I have the problem of Import custom tax and VAT tax for purchasing.
It is Domestic Sales scenario. Need to purchase material from oversea vendor.
Oversea vendor sell material to China company RMB 100 per PC.
Mainland company needs to pay custom for custom tax 20% and the custom tax is non-deductible. Custom tax is 100*(20%) = RMB 20.
Then, Mainland company needs to pay China government VAT tax(17%),
VAT tax is 100*(1+custom tax)*(VAT tax)-100 = 100*(1.2)*(1.17) - 100 = 40.4
So, VAT tax amount = Material price * custom tax * VAT tax
In PO, I use ZOA1 custom condition type to input Cutom tax amount for Custom tax and input Tax code for VAT tax.
When good receipt, RMB 120 post to Material stock account. RMB 100 post to GR/IR. RMB20 post to custom account
It still be fine.
When do LIV, RMB 100 clear GR/IR. RMB 17 post to VAT tax account because it use RMB 100 as base amount to calculate VAT tax. RMB117 post to AP vendor account.
Actually, mainland company only pays RMB100 to oversea vendor and the Tax amount should be include Custom amount. Corrrect VAT tax amount is 100*(1.2)*(1.17) - 100 = 40.4 (use RMB120 as base amount to calculate VAT tax), but not only RMB 17 . But, in LIV payment to vendor now is RMB120. It is not fulfill the requirement of mainland company.
Do anyone have experience about China Import purchasing material. And, would share how to settle the payment of vendor and how to make use (Material price + Custom tax amount) as base amount to calculate VAT tax amount?
Thanks a lot for your help!
Mag
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