1. Localizations for India Implementation Guide
  2. Setup Requirements for Service Tax in the P2P Cycle

Setup Requirements for Service Tax in the P2P Cycle

This table lists the service tax setup requirements for the P2P cycle in India:

Setup Requirement

Comments

Cross-Reference

Map the service tax to the business unit.

You use the Service Tax Unit definition program (P75I704) to map an excise branch/plant to a service tax operating unit.

See Mapping Business Units to Service Tax Operating Units.

Enter the localized category codes.

You attach category code values for item price groups in the Item Branch/Plant (P41026) program. For customer groups, you attach category codes values in the Address Book (P01012) and Customer Master Information (P03013) programs.

See Assigning Localized Category Codes to Items.

Verify that landed cost rules for India taxes exist in the UDC table 41/P5.

Enter the landed cost rules.

You use the Landed Cost Revisions program (P75I791) to set up landed cost rules for one of the following:

  • A specific item, branch/plant, and supplier

  • A specific item and branch/plant

  • A specific cost rule code (UDC table 41/P5)

See Setting Up Landed Costs.

Run the Service Tax Reclassification AP program (R75I700A).

Run the Service Tax Reclassification AP program (R75I700A) to review the service payments for a defined period and also determine whether the tax lines require classification. If the processed line corresponds to a recoverable tax line within the service tax regime, this program generates a reclassification journal entry with credit information for the account associated with AAI item 7530, and debit information for the account associated with AAI item 4230. The system uses the GL offset in the cost rule, payment batch number, document number, and GL date to generate a reclassification journal entry. The service tax regime number, this program generates a reclassification journal entry with credit information for the account associated with AAI item 7585, and debit information for the account associated with AAI item 4385. The system uses the GL offset in the cost rule, payment batch number, document number, and GL date to generate a reclassification journal entry.