This chapter discusses these topics:
Section 35.1, "Understanding GST on Goods and Services Procured for Personal Use"
Section 35.2, "Identifying Goods Procured for Personal Consumption"
Section 35.3, "Identifying Services Received for Personal Use"
Section 35.4, "Offsetting GST Credit for Personal Consumption of Purchased Goods"
Section 35.5, "Reporting Purchased Goods and Services for Personal Use"
Section 35.6, "Identifying Manufactured Goods for Personal Consumption"
Section 35.7, "Reporting Manufactured Goods for Personal Consumption"
You cannot avail GST input tax credit (ITC) for the procurement of raw materials in these scenarios:
Personal use of goods and services
Nonsubmission of documentary evidence
Manufacture of exempted goods, and provision of exempted services
You cannot claim ITC on GST applicable raw materials that you procure to manufacture goods and provide services that are not applicable for GST.
To offset the ITC for these goods and services, you must:
Identify the quantity of goods that are for personal consumption. For services obtained for personal purpose, you must associate the service transactions with a GST rule that is set up as GST not recoverable.
Run the Personal Consumption Update ITC program (R75I805).
You use the Personal Consumption and GST Credit Setoff program (P75I817), ZJDE0001 version, to select purchase transactions and identify them for personal consumption or other category where ITC is not applicable.
The system displays all purchase order receipts from the Purchase Order Receiver File table (F43121) that has a value of 1 (No voucher exists) in the Match Type field. You specify the quantity of items for personal use, and the system segregates the GST (SGST, CGST, IGST, and Cess) amounts for the entered quantity from the total GST amounts calculated for that order.
The system stores the information that you enter in this program to the Personal Consumption GST Setoff table (F75I824).
If there is an existing personal consumption record for an item in the F75I824 table and you further specify available quantity of the item for personal consumption using a different reason code, the system adds a new record for the new reason code in the F75I824 table. If you consume available quantity of the item using the same reason code, then the existing record is updated.
Before you complete the tasks in this section:
Receive the items on the purchase order using the PO Receipts program (P4312).
Set the Consumption Mode processing option for the P75I817 program, ZJDE0001 version to 0 or blank (Personal Consumption - Inputs).
To search for and review purchase order receipts for GST:
From the GST Module, click GST Daily Processing (G75IGST3H) and then Sales Personal Consumption and GST Credit Setoff.
On the Work With Purchase Order Receipts For GST form, review the values in the following fields:
Show All Records
By default, this option in the header is not selected and the system displays only those records for which the available quantity of the item is not zero. Select this option to display all the purchase order receipts, including those receipts with zero available quantity.
Available Quantity
In the grid, the system displays the available quantity of the item that can be marked for personal consumption.
Total Tax Amount
The system populates this field in the grid with the total GST amount for the received quantity of the item. This is the amount for which you can avail ITC.
You can review the breakup of this amount for CGST, SGST, IGST, and GST Cess (as applicable) in the CGST Amount, IGST Amount, SGST Amount, and CESS Amount fields in the grid.
To enter quantity of the items for personal consumption:
From the GST Module, click GST Daily Processing (G75IGST3H) and then Sales Personal Consumption and GST Credit Setoff.
On the Work With Purchase Order Receipts For GST form, select a record and click Select.
On the Personal Consumption and GST Credit Setoff form, complete the following fields:
Reason code
The reason code identifies the reason for the duty credit setoff.
Consumption Quantity
This is the quantity of the item that you are declaring as not applicable for input tax credit (ITC).The quantity that you enter in this field must not be a negative value, and must be less than or equal to the available quantity.
On the Calculate Tax - Setoff section of the form, review the values in the following fields:
Quantity Received
Total GST Credit
The system populates this field with the total GST amount for the received quantity of the item. This is the amount for which you can avail ITC.
You can review the breakup of this amount for CGST, SGST, IGST, and GST Cess (as applicable) in the GST Breakup section of the form.
Total Qty Consumed
Total Setoff GST
The system populates this field with the setoff GST amount based on the quantity of the item that has already been specified for personal consumption in the Total Qty Consumed field.
You can review the breakup of this amount for CGST, SGST, IGST, and GST Cess (as applicable) in the GST Breakup section of the form.
Setoff GST
The system populates this field with the setoff GST amount based on the quantity of the item that you entered in the Consumption Quantity field. After you click OK on this form, the system moves the amount in this field and adds it to the Total Setoff GST field.
You can review the breakup of this amount for CGST, SGST, IGST, and GST Cess (as applicable) in the GST Breakup section of the form.
For services procured for your personal use, you associate the service transactions with a GST rule that is set up as GST non-recoverable. You associate the GST rule with the service transactions in the Voucher Entry GST Tag file program (P75I810). The system does not calculate the GST for records set up with GST as non-recoverable.
You run the Personal Consumption Update ITC program (R75I805) to offset GST input tax credit (ITC) for purchased goods that are personally consumed by the purchaser. This program retrieves information from the Personal Consumption GST Setoff table (F75I824) and GST Cross Reference Setup table (F75I803).
When you run the program, the system retrieves the personal consumption purchase order records for the GST unit (comprising all business units under the GST unit) that you specify in the processing option or during data selection. The system retrieves only those unprocessed records that do not have a value of Y (Processed) in the Processed Flag field of the F75I824 table and have a value of Y in the Recoverable field of the GST Tax File table (F75I807). You can run the program in proof mode or final mode.
In proof mode, the system prints the transactions at the purchase order item level and reason code level with the GST (CGST, IGST, SGST, and Cess) amounts summarized at the GST unit and business unit levels.
In final mode, the system:
Prints the Personal Consumption Update ITC report, listing all the transactions at the purchase order level for each business unit with the GST (CGST, IGST, SGST, and Cess) amounts summarized at the business unit level and GST unit level
Generates and displays the batch number in the report
Updates the Processed Flag field in the Personal Consumption GST Setoff table (F75I824) to Y (Processed)
After a purchase order has been marked as Processed, the system will not mark the order again as Processed when you run the program again to process available quantity of items in the same purchase order.
Enters decreased GST amounts for each applicable GST type (IGST, SGST, CGST, and Cess) in the input tax credit (ITC) ledger in the GST Ledgers-IND-75I table (F75I823)
The system uses the GL date that you enter in the processing option to retrieve the period and year. The system also uses this GL date when records are added to the F75I823 and F0911 tables.
Updates the ITC closing balances in the GST Ledgers Setup table (F75I804) with decreased ITC summarized amounts at the GST unit level
Based on the combination of the GST unit, period and year, the system fetches records from the F75I804 table and updates the ITC ledger for the records.
Creates journal entries in the Account Ledger table (F0911) by crediting the intermediate GST account and debiting the GST permanent account
The system determines the intermediate and permanent accounts from the GST Account Master Setup table (F75I805). The system creates journal entries only when the GST amount is not equal to blank or zero.
If the ledger update for a GST unit is successful, the system prints the message in the report that the ledger has been updated successfully. If the ledger update for a GST unit failed, the system prints an error message in the report including the cause for the error. The system does not update the tables for that GST unit, but continues to process the other GST units.
Before you complete the task in this section, set up the processing options for the R75I805 program.
In the processing options, you specify:
Ensure that the GST Tax File table F751807 is updated through the voucher match process.
Set up the processing options for the R75I805 program. In the processing options, you specify:
Whether to run the program in proof or final mode
The GST unit for which you want to run the report
The G/L date that the system uses for the journal entries that are created in the Account Ledger table (F0911) and for the ledger detail records that are created in the GST Ledgers-IND-75I table (F75I823)
If you do not specify the G/L date, the system uses the system date.
The system also uses this GL date to retrieve the period and year for the specified GST unit.
You run the Print Non Utilizable GST Details for Purchase program (R75I806) to report the details of the personal consumption transactions on goods and services for all the business units under the GST unit that you specify in the processing option.
For goods transactions, the system retrieves records from the Personal Consumption GST Setoff table (F75I824) and GST Cross Reference Setup table (F75I803). The system retrieves only those records marked as processed in the F75I824 table.
For service transactions, the system retrieves records from the GST Tax File table (F75I807) and the Accounts Payable Ledger table (F0411). The system retrieves only those non-recoverable and non-voided accounts payable records.
When you run the R75I806 program, the system prints a report of the goods and services transactions for which the GL date falls between the dates entered in the From Date and Thru Date processing options for the GST unit specified in the processing option.
The report includes goods and services information at the business unit level and GST unit level.
For each business unit, the system prints:
Information about personal consumption transactions for goods at the purchase order item level and reason code level
The report includes information such as purchase order details, reason code, total quantity consumed, GST amounts (CGST, SGST, IGST, and Cess), total GST amounts, and item details.
Information about personal consumption transactions for services at the voucher pay item level
The report includes information such as voucher details, SAC, GST amounts (CGST, SGST, IGST, and Cess), and total GST amounts.
The total GST for all the goods transactions in the business unit
The total GST for all the services transactions in the business unit
The total GST for all transactions (goods and services) in the business unit
At the GST unit level, the system prints the grand total GST, which is the total of both goods and services transactions for all the business units under the GST unit.
Before you complete the task in this section, set up the processing options for the R75I806 program. If you leave the processing options blank, the system displays specific errors in the report.
In the processing options, you specify:
The GST unit for which you want to run the report
The start and thru G/L dates to select records for processing
Although you are liable to pay GST on manufactured goods in the following scenarios, you cannot claim ITC on these goods:
Personal consumption of manufactured goods
Manufacture of exempted goods
You cannot claim ITC on GST-exempted goods that are manufactured using raw materials and services applicable for GST.
Scrapped goods
To classify the goods that fall under these scenarios, you use the stock transfer process to move these goods to a logical unit (not a physical one). You must create the stock transfer orders for personal consumption goods using the document type in the UDC table 75I/DP.
You use the Reclassify Stock Transfer for Manufactured Goods program (P75I817), ZJDE002 version to declare that the goods in the stock transfer orders are for personal consumption or other categories where ITC is not applicable. The P75I817 program, ZJDE002 version, displays all the stock transfer orders that has the document type from the UDC table 75I/DP.
The system saves the declared stock transfer orders along with the reason code in the Reclassify Stock Transfer for Manufactured Goods table (F75I836).
Before you complete the tasks in this section:
Define a separate branch/plant for personal consumption.
This is not a physical branch plant as there is no actual movement of goods.
Set up the document type to classify stock transfer orders for personally consumed goods using the UDC table 75I/DP.
The document type that you set up in this UDC table must also exist in the UDC table 00/DT.
Create a stock transfer order from the manufacturing branch/plant to the personal consumption branch/plant in the Sales Order Entry program (P4210).
You must create the stock transfer order using the document type set up in the UDC table 75I/DP, and using the adjustment schedule that you set up for GST.
Complete the print pick slip process using the Print Pick Slip program (R42520) and the sales update process using the Sales Update program (R42800).
Set the Consumption Mode processing option for the P75I817 program, ZJDE0002 version to 1 (Personal Consumption - Manufactured Items).
To declare manufactured goods for personal consumption:
From the GST Module, click GST Daily Processing (G75IGST3H), and then Purchase Personal Consumption and Reclassify Stock Transfer for MFG Goods.
On the Reclassify Stock Transfer For Manufactured Goods form, review the existing stock transfer orders for personally consumed goods and the GST calculated for the orders.
By default, the system displays only those records that are not linked with a reason code. To display all stock transfer order records including those records with reason codes, select Show All Records.
Select the record that you want to mark for personal consumption and complete the Reason Code field.
The reason code identifies the reason for non-applicability of ITC on these goods.
Optionally, complete the Remark field.
Click Update Reason for Selected Records to commit the goods in the stock transfer order.
To update the reason code, enter a new code in the Reason Code field and click Update Reason for Selected Records.
You run the Print GST for Reclassified Stock Transfer program (R75I814) to print the GST information for manufactured goods that you have declared for internal consumption, finished goods for which you cannot claim ITC, or scrapped goods.
The system retrieves records from the Reclassify Stock Transfer for Manufactured Goods table (F75I836) and GST Tax File table (F75I807) based on the values that you specify in the processing options.
The report includes goods information at the business unit level and GST unit level.
For each business unit, the system prints:
Information at the order line level for the quantity transferred, the taxable amount, and the GST amounts (CGST, SGST, IGST, and Cess)
The total CGST, SGST, IGST, and Cess for all the goods transactions in the business unit
At the GST unit level, the system prints the total taxable amount and the total GST for all the business units under the GST unit.
Before you complete the task in this section, set up the processing options for the R75I814 program. If you leave the processing options blank, the system displays specific errors in the report.
In the processing options, you specify:
The GST unit for which you want to run the report
The start and thru G/L dates to select records for processing
Reason code for the stock transfer