Professional Documents
Culture Documents
A manufacturer may pay VAT on input raw materials and recovers that tax when he sells the finished goods to a
dealer. The difference of tax collected from the dealer and the tax paid for the raw materials is paid to the tax
authority.
Similarly, a dealer may pay VAT on the finished Goods and recovers that tax when he sells it to a retailer. The tax
after recovery is paid to the tax authority.
Finally the end customer pays the VAT to the retailer. The retailer recovers his portion of the tax he paid and pays
the balance to the tax authorities.
CENVAT is a Central VAT. You have the provision to claim this tax at the time of receipt. The RG registers are
updated with the CENVAT entries at the time of receipt.
Customs Duty :
Customs Duty is paid on goods when goods are imported into India
It is paid in INR as a % of the duty over the value of goods received in foreign Currency.
In Oracle, provision is made to pay this duty as a prepayment before receiving the materials and it is adjusted
against BOE given by Customs.
When goods are received into the inventory org, they should be associated with the BOE Tax amount paid on them
at the time of import.
These Entries are registered in a Tax Register called RG23D . While Shipping the goods on a sales order, the
deliveries are associated with these registry entries.
Service Tax
Service tax is paid for the services rendered. Examples are
telecom service, tax services, consulting services Etc.
You can define Tax regime for Service tax and have service tax
registration.
Setup steps :
Additional Organization Information - Tax Information , Accounting Info and Trading Info
Eg Suppose we created a new Org named OOS (Old Org Service) , after creating this org ,
we have to go to Additional Organization Information form and give the following information :
=> Tax Info
=> Accounting Info
=> Preferences
=> Trading Info
Under the Tax Info Tab :
We give the Excise Information , Sales Tax Information , Income Tax information ,VAT information for this
particular Organization .
The Excise , Sales Tax , Income Tax and Vat info that we give in this form is used to Print on their respective
documents eg Sales Tax doc , Income Tax doc etc ...
Once we give the EXCISE info under the Tax Info tab then this Organization is considered as a
MANUFACTURING Org .
And when we give the EXCISE Information under the TRADING INFO Tab then this Organization is
considered as a TRADING Organization .
An Organization can be either a Manufacturing Org or a Tading
Org , but not both .
Setup "Item Templates" for India Localization and apply the templates to items .
We can define Item Templates for Excise and VAT.
Define Customs Duty Authority, Excise Authority, VAT Authority, Service Tax Authority as VENDORS.
Appropriate VENDOR TYPE has to be selected while defining these vendors .
Eg While defining Customs Authority , we have to select 'Vendor Type' as "India Customs Authority"
Some other Vendor Type exmaples are :
-> India custom Authority
-> India Excise Authority
-> India VAT Authortty
We will cut the Payables Invoices to these authorities for the taxes to be paid .
Regime Registration :
Setups in Bond Register are required to generate Excise Invoice numbers and updation of excise registers
We specify the Order Type from OM in Bond Register to associate the related excise transactions
Excise transactions related to MFG and Trading need to be associated with the BondRegister
By associating the order types to the excise transactions for Inv Org and location ,excise records will be passed
bases on nature of goods cleared
Some exmaples of Register Types are :
Export with Excise
Domestic with Exicse
Domestic without excise
Defaulting of taxes :
The item category will list items and associated tax category.
When POs are created , taxes are defaulted from Item category specified on SUpplier and Supplier Sites in
Additional Supplier Info
When Sales Orders are created , taxes are defaulted on SO from Item Category specified on the CUSTOMERS
and Customer site in Assitional Customer Info.
Go to Customer Tax Information form
Under the customer give the Excise , Service Tax , Sales Tax and VAT info fopr that Customer .
Below is the CUSTOMER :