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Reply from Roy B on Aug 21 at 8:16 AM I offered to send you a guide to configuring VAT off-forum but you did not take up my offer. What do you expect me to do now? I do not know the SAP Notes you mention and have no access to SAP notes at this time.
Reverse charge VAT uses two equal and opposite postings. The logic is that you can only deduct input tax that you have paid but, in a case where you import goods or services without VAT, you have to put the invoice on the same basis as domestic invoices with VAT, so you book both input and output tax. To do this you use the accounting types ESA and ESE within a single tax code. "A" in this case denotes output tax "Ausgangssteuer" in German and "E" denotes input tax "Eingangssteuer". You put the tax percentage against ESA and then make ESE -100% of ESA. Behind these you put either one or two different GL accounts according to the law of the land. SAP will then calculate an equal and opposite posting. Say your tax % is 20%. You have an invoice for 2000 net. You give it the tax code you have created, let's say "S2" for service tax. The posting then becomes:-
Dr Expense 2000 S2
Dr Input tax 400 S2
Cr Output tax 400 S2
Cr Vendor 2000
Your tax reporting is correct because both tax lines use the same base amount. You pay the vendor what he has invoiced and everything is rosy.
Regards,
Roy
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| | | ---------------Original Message---------------
From: Ibrahim Sayyed
Sent: Tuesday, August 21, 2012 7:32 AM
Subject: Reverse Charge Mechanism Applied in Service Tax On Passenger Travel Bills
Roy sir Good Evening!!!
I have gone through SAP notes but couldn't able get much out of it. I have gone though following notes.
1244301
1242881
1571186
Please guide ..
Ibrahim |
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