Displaying Taxes in MM

Displaying the goods receipt document

1. Call up the transaction as follows:

Menu Path	Logistics ® Materials Management ® Inventory Management ® Material Document ® Display
Transaction Code	MB03, FB03

2. Enter the following data:

Field	Data
Material doc.	Number of a GR document
Mat. doc. year	Current year

3. Choose .
4. Choose Accounting docs...
5. In the dialog box, choose Accounting document.

The system displays the GR document.

6. Choose .
7. To close the dialog box, choose .
8. Choose until the overview tree appears.

Displaying the invoice receipt document

1. Call up the transaction as follows:

Menu Path	Logistics ® Materials Management ® Logistics Invoice Verification ® Further Processing ® Display Invoice Document
Transaction Code	MIR4, FB03

2. Enter the following data:

Field	Data
Invoice doc. number	Number of IR document
Fiscal year	Current year

3. Choose .
4. Choose Follow-on documents.
5. In the dialog box, choose Accounting document.
6. Choose .
7. To close the dialog box, choose .
8. Choose until the overview tree appears.

Scenario 1: Invoice with sales tax (tax code I1)

1. Display the goods receipt document.

In this example, the invoice was for 104.00 and included taxes, which are to be paid to the vendor. Notice that the taxable value is reflected in the inventory value The document should be as follows:

	Account	Description
DR	300000	Inventory (G/L account)	104.00
CR	191100	GR/IR (G/L account)	104.00

2. Display the invoice receipt document.

The document should be as follows:

	Account	Description
CR	3920	Vendor	104.00
DR	191100	GR/IR (G/L account)	104.00

3. By choosing Goto
® Tax data, you can see which jurisdiction code and which tax rates were used.

Scenario 2: Invoice without sales tax (tax code I0)

1. Display the goods receipt document.

In this example, the invoice amount was 100.00 and no taxes were included. The document should be as follows:

	Account	Description
DR	300000	Inventory (G/L account)	100.00
CR	191100	GR/IR (G/L account)	100.00

2. Display the invoice receipt document. The document should be as follows:

	Account	Description
CR	3920	Vendor	100.00
DR	191100	GR/IR (G/L account)	100.00

3. By choosing Goto
® Tax data, you can see which jurisdiction code and which tax rates were used.

Scenario 3: Invoice with use tax (tax code U1)

1. Display the goods receipt document.

In this example, the invoice is for 100.00. The tax is the responsibility of the person making the purchase and is not paid to the vendor. Notice that the taxable value is reflected in the inventory value The document should be as follows:

	Account	Description
DR	300000	Inventory (G/L account)	104.00
CR	191100	GR/IR (G/L account)	104.00

2. Display the invoice receipt document. The document should be as follows:

	Account	Description
CR	3920	Vendor	100.00
DR	191100	GR/IR (G/L account)	104.00
CR	175001	State sales/purchase tax (G/L account)	4.00

3. By choosing Goto
® Tax data, you can see which jurisdiction code and which tax rates were used.

Scenario 4: Invoice without use tax (tax code U0)

1. Display the goods receipt document.

In this example, the invoice amount was 100 and no taxes were included. The document should be as follows:

	Account	Description
DR	300000	Inventory (G/L account)	100.00
CR	191100	GR/IR (G/L account)	100.00

2. Display the invoice receipt document. The document should be as follows:

	Account	Description
CR	3920	Vendor	100.00
DR	191100	GR/IR (G/L account)	100.00

3. By choosing Goto
® Tax data, you can see which jurisdiction code and which tax rates were used.

Posting Taxes in MM

Use

In MM, the tax codes appear as default values based on the settings made in Customizing. The IDES System is configured so that only purchase orders requiring an account assignment are taxable. When a purchase is made for stock or directly for a production order, tax code I0 appears as a default value. If a purchase is made for a cost center, tax code I1 appears as a default value and the tax rate depends on the tax jurisdiction code that is linked to that cost center. If you want to have different default values for taxes in some situations, you can overwrite the default value in the info record. In this process, you post four different invoices using four different tax codes (I1, I0, U1, and U0).

Write down all numbers assigned by the system.

Procedure

Entering a purchase order

1. Call up the transaction as follows:

Menu Path	Logistics ® Materials Management ® Purchasing ® Purchase Order ® Create ® Vendor/Supplying Plant Known
Transaction Code	ME21N

2. Enter the following data:

Field	Data
Vendor	3920

Make sure that Standard PO is selected.

3. To open the item header area, choose Header.
4. Choose .
5. On the Org. data tab, enter the following data:

Field	Data
Purchasing org.	3000
Purch. group	001
Company code	3000

When you generate invoices #2 to #4, a dialog box may appear, informing you that a purchase order already exists for today. In this case, choose Purchase order ® Other purchase order.

6. To open the item overview area, choose Item overview.
7. Enter the following data:

Field	Data
Item number	10
Material	V10
PO quantity	1
Deliv. date	A few days in the future
Net price	100.00
Currency	USD
Plant	3000
Stor. loc.	0001

8. Choose .



Choose if the system outputs any warning messages.

9. Select your item, then choose Item detail.

The tax code that was selected appears on the Invoice tab. Each example requires a different tax code.

10. On the Invoice tab, enter the following data:

Field	Data
Tax code for invoice #1	I1

11. Choose .
12. To see the tax rate, select your item and then choose Taxes.

The system displays the default tax jurisdiction code for the plant.

13. Choose .
14. Choose .
15. Note the purchase order number.
16. Repeat steps 2 to 12 for invoices #2 to #4.

Field	Data
Tax code for invoice #2	I0
Tax code for invoice #3	U1
Tax code for invoice #4	U0

17. Choose until the overview tree appears.

Goods receipt

1. Call up the transaction as follows:

Menu Path	Logistics ® Materials Management ® Purchasing ® Purchase Order ® Follow-On Functions ® Goods Receipt
Transaction Code	MIGO

2. Enter the following data:

Field	Data
Purchase order	Your PO number

3. Choose .
4. Flag the OK indicator in the item overview area for your item.



If the OK indicator is not active in the item overview area, either close the item detail area or select Item OK in the lower part of the item detail area.

5. Then select Post at the top of the screen.



The system confirms the posting and assigns a material document number. Take a note of this number.

6. Repeat steps 2 to 4 for invoices #2 to #4.
7. Choose .

Invoice receipt

1. Call up the transaction as follows:

Menu Path	Logistics ® Materials Management ® Purchasing ® Purchase Order ® Follow-On Functions ® Logistics Invoice Verification
Transaction Code	MIRO

2. Enter the following data:

Field	Data
Document date	Today’s date
Invoice date	Today’s date
Amount for invoice #1	104.00
Calculate tax	Select
Tax code for invoice #1	I1 A/P sales tax, taxable
PO order/scheduling agreement	Your PO number



The tax code is not transferred from the purchase order because the system is configured to always use I0 as a default value.

3. Choose .
4. Choose .

Confirm any warnings by choosing . The system posts your document automatically.

5. Make a note of the document number.
6. Repeat steps 2 to 6 for invoices #2 to #4.

Field	Data
Amount for invoice #2	100.00
Amount for invoice #3	100.00
Amount for invoice #4	100.00
Tax code for invoice #2	I0 A/P sales tax, exempt
Tax code for invoice #3	U1 A/P use tax, taxable
Tax code for invoice #4	U0 A/P use tax, exempt

7. Choose until the overview tree appears.

Displaying Taxes in SD

Use

In this process, you display the billing document that was posted in Posting Taxes in SD. Tax code S1 was automatically determined from the tax status of the material and the customer. Since tax code S1 is a taxable code, the system copied the tax jurisdiction code of the customer, IL0011000, and calculated state taxes at a rate of 6.25%.

Procedure

1. On the Create Billing Document screen, choose .
2. Choose Accounting.
3. In the dialog box, choose Accounting document.

The document overview appears. The accounting document created by billing should be as follows:

	Account	Description
DR	3050	Customer	4,038.56
CR	800000	Sales revenues (G/L account)	3,801.00-
CR	175001	State sales/purchase tax (G/L account)	237.56-

4. To display the tax data, choose Tax data.

The tax amount was calculated as follows:

Material price 3,801.00

Minus discount 00.00

Equals taxable value 3,801.00

Multiplied by tax rate 6.25%

Equals tax amount 237.56

The receivable amount was calculated as follows:

Material price 3,801.00

Minus discount 00.00

Plus tax amount 237.56

Equals receivable amount 4,038.56

5. Choose .
6. Choose .
7. To close the dialog box, choose .
8. Choose until the overview tree appears.

Posting Taxes in SD

Use

In this process, you post a customer sales order, deliver the product, and invoice the customer. You post only one example where the item is taxable. Your results will vary depending on which tax code you use (S1 or S0) and what jurisdiction your customer is assigned to. (The results would be the same as in Displaying Taxes in FI: Accounts Receivable). The purpose of this process is to show a posting example in SD.

Procedure

Entering the order

1. Call up the transaction as follows:

Menu Path	Logistics ® Sales and Distribution ® Sales ® Order ® Create
Transaction Code	VA01

2. Enter the following data:

Field	Data
Order type	OR
Sales organization	3000
Distribution channel	10
Division	00

3. Choose .
4. Enter the following data:

Field	Data
Sold-to party	3000
Purchase order number	Any
Material	P-103
Order quantity	1

5. Choose .
6. In the dialog box, double-click on Partner 3000.
7. Choose .
8. Make a note of the order number and the requested delivery date.
9. Choose until the overview tree appears.

In the Exit Order Processing dialog box, choose No.

Posting the delivery

Once the order has been posted, you need to deliver the product.

1. Call up the transaction as follows:

Menu Path	Logistics ® Sales and Distribution ® Sales ® Order ® Subsequent Functions ® Outbound Delivery
Transaction Code	VL01N; LT03

2. Enter the following data:

Field	Data
Shipping point	3000
Selection date	Required delivery date noted
Order	Your order number

3. Choose .
4. Choose Subsequent Functions ® Create transfer order.
5. In the Exit Document Processing dialog box, choose Yes.
6. Enter the following data:

Field	Data
Warehouse number	300
Plant	3000
Foregroung/backgrnd	Background
Adopt pick.quantity	2

7. Choose .
8. Your delivery is now posted. Make a note of the delivery number.
9. Choose .

Posting the invoice

Now you have to invoice the customer. You will see the taxes posted on the invoice.

1. Call up the transaction as follows:

Menu Path	Logistics ® Sales and Distribution ® Sales ® Order ® Subsequent Functions ® Billing Document
Transaction Code	VF01

2. Choose .
3. Make a note of the document number.
4. Remain on this screen.

Displaying Taxes in FI: Accounts Payable

1. Call up the transaction as follows:

Menu Path	Accounting ® Financial Accounting ® Accounts Payable ® Document ® Display
Transaction Code	FB03

2. Enter the following data:

Field	Data
Document number	Invoice number (invoice #1)

3. Choose .

The document overview appears.

Invoice #1: Payables invoice with tax on sales/purchases

When you post this invoice, you assume that the invoice amount of 100.00 already includes taxes and the taxes are paid to the vendor. This invoice was posted using tax code I1, which means the item is subject to tax on sales/purchases. Cost center 1000 is linked to tax jurisdiction code PA0000000, which is taxable at the state level only at a rate of 6.00%. The full amount of the invoice, plus taxes, must be paid to the vendor. The displayed document should be as follows:

	Account	Description
CR	3000	Vendor	100.00
DR	476000	Expense (G/L account)	100.00

Although the accounting document does not reflect any taxes being posted, you can see that the system does keep a record of the tax data. Choose Tax data to display this information.

To close the dialog box, choose .

4. Choose .
5. Repeat this transaction for invoices #2 to #4.

Invoice #2: Payables invoice without tax on sales/purchases

This invoice was posted using tax code I0, which means that no tax is posted. In this case, the jurisdiction code is not significant. The displayed document should be as follows:

	Account	Description
CR	3000	Vendor	100.00
DR	476000	Expense (G/L account)	100.00

Although the document looks exactly the same as invoice #1, the tax data shows that no taxes applied for this invoice. Choose Tax data to display this information.

Invoice #3: Payables invoice with interstate tax on sales/purchases

This invoice was posted using tax code U1, which means that interstate tax on sales/purchases applies. Interstate tax is the responsibility of the person making the purchase and is not paid to the vendor. The tax value is calculated at a rate of 6.00%, the rate for jurisdiction PA0000000, which is linked to cost center 1000. The displayed document should be as follows:

	Account	Description
CR	3000	Vendor	100.00
DR	476000	Expense (G/L account)	106.00
CR	175001	State sales/purchase tax (G/L account)	6.00

Invoice #4: Payables invoice without interstate tax on sales/purchases

This invoice was posted using tax code U0, which means that the item is not liable for interstate tax on sales/purchases and so no taxes are calculated or paid. The displayed document should be as follows:

	Account	Description
CR	3000	Vendor	100.00
DR	476000	Expense (G/L account)	100.00

6. Choose until the overview tree appears.

Posting Taxes in FI: Accounts Payable

Use

In this process, you post four separate accounts payable invoices. The invoices all have the same value, but contain different tax codes. The purpose of this exercise is simply to post the invoices. To display the resulting documents and see how the separate taxes are posted, see Displaying Taxes in FI: Accounts Payable.

Procedure

1. Call up the transaction as follows:

Menu Path	Accounting ® Financial Accounting ® Accounts Payable ® Document Entry ® Other ® Invoice - General
Transaction Code	F-43

2. Enter the following data:

Field	Data
Document date	Today’s date
Document type	KR
Company code	3000
PstKy	31
Account	3000

3. Choose .
4. Enter the following data:

Field	Data
Amount	100.00
Tax amount	Leave blank
Calculate tax	Select
Tax code for invoice #1	I1
PstKy	40
Account	476000

5. Choose .

Note that the tax code was copied from the previous screen.

6. Enter the following data:

Field	Data
Amount	*
Cost center	1000

7. Choose .

Note that the jurisdiction code was automatically copied from the cost center.

8. Choose .

The system confirms that the document has been posted.

9. Make a note of the invoice number.
10. Repeat steps 2 to 10 for invoices #2 - #4. Confirm the warning after step 5 by choosing .

Field	Data
Tax code for invoice #2	I0
Tax code for invoice #3	U1
Tax code for invoice #4	U0

11. Choose .
12. In the Exit Editing dialog box, choose Yes.