SAP CIN Configuration In Indian Taxing procedure, Excise Duty plays a vital role in

manufacturing cenario ’s. Excise related configuration is known as CIN configuration.

CIN Configuration is a topic in itself. Some info on CIN Configuration (it may not appear
as understandable below, but if you check on screen, it will be understood better) Country
Version India comes with four pricing procedures as follows: - JINFAC (Sales from
manufacturing plants) - JINEXP (Export sales) - JINDEP (Sales from depots) - JINSTK
(Stock transfers CIN: IMG > Logistics - General > Tax on Goods Movement > India >
Basic Settings > Maintain Excise Registrations In this IMG activity, you maintain the
data relating to your excise registrations. - Enter each of your excise registrations,
specifying a four-character code for each Excise Registration Ids In this activity, you
maintain excise registration IDs. You create one ID for each of your business's excise
registrations. - For each excise registration in your business create a registration ID, and
state: - Which taxes the registration covers (additional excise duty, special excise duty,
and cess) Fields for any taxes that are not covered will be hidden in transactions
involving excise duty. - The maximum number of items to be printed on each excise
invoice - Whether you are allowed partial CENVAT credits Maintain Registration ID
NUMBER, Excise code number, excise registration number ECC Number: Specifies the
organization's ECC number. Excise Registration Number: A number assigned to each
premises or location that has registered as a manufacturer with the excise authorities.
Every entity with an excise registration number is required to keep its own excise books.
Excise range: Specifies the excise range in whose area the excise registration is located.
Excise Division: Specifies the excise division in whose area the excise registration is
located. Excise Collectorate: The code of the excise collectorate in whose area the excise
registration is located. Indicator for confirming, AED usage Additional Excise duty
Percentage. These are livable under the additional duties of excise act. These duties are in
addition to basic excise duty and special excise duty. Example - Additional Excise duty is
livable in case of textile products, tobacco and sugar. Similarly for SED CESS Number of
Items in Excise Invoice Shows the maximum number of line items that the authorities
allow per excise invoice. Dependencies - This information is used when you create an
excise invoice in Sales and Distribution (SD) for factory sales and for other movements.
This information is used to split the transfer postings' items into multiple subcontracting
challans. Excise register set description: Description of the excise registers set. Partial
CENVAT Credit: Indicates that the excise registration ID is allowed to credit only a
portion of its input excise duty to its CENVAT account Dependencies - When you post a
goods receipt, the system splits the input excise duty on the material into its deductible
and nondeductible amounts. It posts the deductible duty to the appropriate CENVAT
account, and adds the nondeductible duty to the material value. This information is also
shown when you post the vendor's excise invoice. Maintain Company Code Settings. In
this IMG activity, you maintain the data relating to your company codes. Document Type
for CENVAT Postings. It controls, which document type the system uses when making
CENVAT postings in Financial Accounting (FI). Here ED is document type for cenvat
posting. Indicator for providing debit account overwriting Debit Account Overwrite
Indicator. X - Indicates debit accounts can be overwritten. Use In excise journal voucher
transaction. It provides the flexibility to the user to enter the debit account of his choice
depending on the nature of transaction. Automatic balance Indicator - Excise year start
month. The calendar month marking the beginning of the excise year. This start month
represents the month for the start of the excise invoice number range. The month 04 is
entered here indicating April of the calendar year as the start month for excise invoices.
Any change by the Excise authorities regarding start month should be taken care of by an
entry in this field and initialization. Excise invoice selection procedure :Excise invoice
selection type. To indicate the method opted by the company for selecting the excise
invoice. It can be either earliest or latest invoices that were received. Number of excise
invoices to be selected Indicates the number of excise invoices that needs to be selected
in the excise invoice selection. Days to be considered for excise invoice selection
Number of days from document date for excise invoice selection. Example - If the value
of this field is 20 and today is 28-03-97. The excise invoice selection will show the
related invoices only for the period 08-03-97 to 28-03-97. Document type for TDS FI
posting: Financial accounting document type for TDS posting. Document type for FI
posting on Utilisation Financial accounting document type for TDS posting. Indicator for
item level excise duty round off - This indicator is to be used for deciding whether Item
level excise duty amount rounding off is required during procurement cycle. If marked
'X' then the excise duty amount will be rounded off to the nearest rupee at the Purchase
order level. This will not round off the CENVAT credit to be taken. If the duty amount is
less than one rupee then no rounding is done Rounding off of Excise duty for outgoing
excise invoice - You can round off the Excise amount to be paid during an outgoing
Excise invoice by marking this indicator as 'X'. The rounding is done at the item level for
each item where the amount is greater than 1 Rupee. Immediate Credit on Capital Goods
- Instructs the system, when you verify a goods receipt for capital goods, to immediately
post half of the input excise duty to the appropriate CENVAT accounts. The rest is posted
the CENVAT on hold account, for use in the following year. CVD Clearing Account -
Specifies which G/L account the system credits when you take a CENVAT credit on
countervailing duty in the Incoming Excise Invoices transaction. Exchange rate type -
Key representing a type of exchange rate in the system. - You enter the exchange rate
type to store different exchange rates. Example - You can use the exchange rate type to
define a buying rate, selling rate, or average rate for translating foreign currency amounts.
You can use the average rate for the currency translation, and the bank buying and selling
rates for valuation of foreign currency amounts. Exchange rate type to be used for Export
excise duty converts - When you are creating an Excise invoice for export sales then the
exchange rate for duty calculation will be picked up using this Exchange rate type.
Maintain Plant Settings - In this IMG activity, you maintain excise information relating to
your plants. Plant Settings - In this activity, you maintain excise information relating to
your plants. For each plant: - Specify whether it is a manufacturing site or a depot. -
Assign it an excise registration ID. - You can assign the same ID to more than one plant,
if required. Depot - Indicates that the plant in question is a depot. - Depots are required to
prepare register RG 23D, and follow different procedures for goods receipt and invoice
generation. - Number of goods receipt per excise invoice. - Multiple GR for one excise
invoice, Single credit - Multiple GR for one excise invoice, multiple credit Maintain
Excise Groups - In this IMG activity, you define your excise groups. For each excise
group, you can also control how various excise invoice transactions will work. Excise
Groups - In this activity, you define excise groups. An excise group allows you to
maintain a separate set of excise registers and excise accounts. The RG 23A, RG 23C and
PLA serial numbers are created for an excise group. Recommendation - Under normal
circumstances, excise authorities require every business to maintain only one set of
excise registers and one set of accounts. But through exemption from the authorities,
multiple books can be maintained. If your company has only one set of excise registers,
then you need to maintain only one excise group. 1. Create one excise group for each set
of registers that you need to keep. 2. Assign the excise groups to plants. 3. Maintain
whether this Excise group is for a depot or not. If you receive only one consignment for
an Excise challan then you can leave GR's per EI as blank. If you receive multiple GR's
for a given Excise challan and would like to avail multiple credit mark the GRs per EI as
'Multiple GR's for one excise invoice, multiple credit'. Alternatively if you want to availa
the credit only after all the goods receipts have been made mark it as ' Multiple GR for
one excise invoice, single credit'. 4. If you want to automatically create Excise invoice
during Sales cycle at the time of billing the tick the indicator 'Create EI' 5. During depot
sales if you do not want to do RG23D selection and posting separately and would like to
complete RG23D selection in one step mark the indicator 'RG23D Auto post'. This will
post the selected records into RG23D automatically. You cannot cancel the selection
later. 6. If the indicator 'Default GR qty' is marked system will default the Excise challan
quantity on to the Goods receipt if the Excise invoice number is given in the pop-up. 7. If
the indicator 'Folio no create' is marked system will generate Folio numbers for RG23D
during receipt of excise invoice into depot. 8. 'Automatic posting' when ticked will post
the Excise invoice other movements automatically along with creation in single step. 9.
'Create Part1 for Block Stock' when marked will create a Part1 during the receipt of
material into Blocked stock . 10. 'Create Part1 for STO' when marked will create a Part1
during the receipt of material through inter plant transfers. 11. 'Create Part1 for
consumption stock' when marked will create a Part1 during the receipt of material into
consumption stock. Excise Group Governs which set of excise registers a business
transaction will be included in. Following is the relation between excise group, plant and
registration. - In define excise groups in Customizing. Then, in transactions involving
excise duty, for example, when you post a vendor's excise invoice, you specify which
excise group you are using. This information tells the system which G/L accounts to post
the excise to. At the end of the period, when you come to prepare your excise registers,
you create different sets for each excise group. Indicates that the plant in question is a
depot. - Depots are required to prepare register RG 23D, and follow different procedures
for goods receipt and invoice generation. - GR Per Excise Invoice - Multiple GR for one
excise invoice , Multiple credit - Multiple GR for one excise invoice , Single Credit
Create Excise Invoice Automatically - Instructs the system to automatically create a Sales
and Distribution (SD) excise invoice immediately you create a commercial invoice or a
pro forma invoice. The excise invoice is created in the background. - If you want to make
use of this function, you must also define the default plant, excise group, and series
groups in Customizing for Sales and Distribution (SD), by choosing Excise Group -
Series Group Determination. RG23D Sales Creation and posting option - RG23D
Automatic Option if selected will create Depot excise invoice by posting the selection of
excise invoices in single step. If this is not selected then you need to separately do
RG23D selection followed by PGI and then RG23D verification and posting. If you need
automatic posting of RG23D selection then the Post Goods Issue should have been
completed before running RG23D selection. Default excise qty in GR - If this indicator is
ticked then while doing Goods Receipt using 'MB01' system will default the excise
invoice quantity on to the Goods receipt document. Folio number for depo Posting - If
this indicator is marked then while creating Excise invoice for other movements system
automatically does the Verify and Post. You need not separately Post the excise invoice
Also we can set indicator for creation of part 1 for: - Blocked stock - Stock transport
order - Consignment stock Maintain Series Group - In this IMG activity, you define the
different excise series groups within your company. Series groups allow you to maintain
multiple number ranges for the outgoing excise documents. Based on excise regulations
and exemptions from the authorities you can maintain multiple number series for
outgoing documents. But each of these series has to be declared to the excise authorities.
- Define excise series groups based on type of outgoing document - Assign series group
to excise registration ID - If no financial postings are required for an Excise invoice in
this seris group then you tick the 'No utilization' indicator. - If the CENVAT has to be
paid immediately and you need not wait for the Fort nightly payment then mark the
'Immediate Utilization' Iindicator. Example - You could define two series groups, group
001 for excise invoices, and group 002 for 57 F4 documents. - No account postings for
CENVAT in sales cycle - No utilization Flag If you do not need any CENVAT utilization
for an excise invoice but would like to just generate an excise invoice then you need to
mark this indicator. If the flag is checked then system will create an Excise invoice in the
given Series group but there will not be any account postings or Part2 postings.
Immediate Utilization of CENVAT - Specifies that when you create an excise invoice,
the system immediately pays the amount from CENVAT and creates the Part II entry.
Such invoices will not be listed for fortnightly utilization. If you have both fortnightly
and immediate utilization for the same excise group, the account determination within
CIN IMG should point to the ED interim account. Account determination for immediate
payment will be done exactly the same as being done for fortnightly utilization program.
Maintain Excise Duty Indicators - In this IMG activity, you maintain the excise duty
indicators. IMG > Logistics - General > Tax On Goods Movement > India > Basic
Settings > Determination of Excise Duty > Select Tax Calculation Procedure In this IMG
activity, you specify which tax procedure you want to use for determining excise duties
and sales taxes on input materials in India. - If you use condition-based excise
determination, use a copy of the tax procedure TAXINN. - If you use formula-based
excise determination, use a copy of the tax procedure TAXINJ. This tax procedure also
supports condition-based excise determination, so that you can work with both
concurrently. We strongly recommend that new customers use condition-based excise
determination. Note that once you have started using a tax procedure, you cannot switch
to another one, otherwise you will not be able to display old documents. Maintain Excise
Defaults - In this IMG activity, you define which tax procedure and pricing condition
types are used in calculating excise taxes using formula-based excise determination. If
you use condition-based excise determination, fill out the CVD cond. field and leave all
the others blank. If you use formula-based excise determination, fill out all of the fields
as follows: - Enter the tax procedure and the pricing conditions that are relevant for
excise tax processing. - Specify the purchasing and sales conditions types used for basic
excise duty, additional excise duty, special excise duty, and cess. - Specify the conditions
in the sales order that are used for excise rates. - Specify the countervailing duty
condition type used for import purchase orders. See also : SAP Library -> Logistics ->
Country Versions -> Asia-Pacific -> India -> Materials Management (MM) -> Condition-
Based Excise Determination and -> Formula-Based Excise Determination. IMG >
Logistics - General > Tax On Goods Movement > India > Basic Settings > Determination
of Excise Duty > Condition-Based Excise Determination When you enter a purchasing
document, for example, a purchase order, the R/3 System automatically calculates the
applicable excise duties using the condition technique. Features : The standard system
comes with two tax calculation procedures. TAXINN is only supports condition-based
excise determination, whereas TAXINJ supports condition-based excise determination
and formula-based excise determination. Both tax procedures contain condition types that
cover all of the excise duties and sales taxes applicable. Since the exact rates of excise
duty can vary on a large number of factors, such as which vendor you purchase a material
from, or which chapter ID the vendor stocks the material under, you create condition
records for every sort of excise duty. When you come to enter a purchasing document,
the system applies the excise duty at the rates you have entered in the condition records.
Customizing : Make the settings in Customizing Basic -> India -> for Logistics –
General, by choosing Taxes on Goods Movements Account -> Excise Duties Using
Condition Technique and …-> Settings Determination. These activities include one
activity where you define a tax code for condition-based excise determination. Master
Data - Create condition records for all excise duties that apply, and enter the tax code for
condition-based excise determination in each. Day-to-Day Activities - When you enter a
purchase order or other purchasing document, enter the tax code for condition-based
excise determination in each line item. The system then calculates the excise duties using
the condition records you have created. When the ordered materials arrive, you post the
goods receipt and the excise invoice. The system posts the excise duty to the appropriate
accounts for deductible input taxes when you enter the excise invoice. Creating Condition
Records for Excise Duty 1. In the command field, enter FV11 and choose . 2. Enter the
condition type that you want to create a condition record for and choose . The Key
Combination dialog box appears. 3. Select the combination of objects that you want to
create the condition record for. On the dialog box, Control Code means "chapter ID." So,
for example, to create a condition record for a tax that applies to a combination of
country, plant, and chapter ID, select Country/Plant/Control Code. 4. Choose . 5. Enter
data as required. - In the Tax Code field, enter the dummy tax code that you have defined.
6. Save the condition record. Formula-Based Excise Determination - When you execute a
business transaction involving materials that are subject to excise duty, the system
automatically calculates the duty for you. In order for the system to be able to determine
which rate of excise duty to apply, you must have maintained all the data on the Excise
Rate Maintenance screen, which you can Master Data®access from the SAP Easy Access
screen by choosing Indirect Taxes Excise Rate Maintenance. You maintain the following
types of data: - Plant master data You assign each of your plants an excise duty indicator.
You can use the same indicator for all the plants with the same excise status from a legal
point of view, such as all those that are in an exempt zone. See also the information about
manufacturers that are only entitled to deduct a certain portion of the duty (see Partial
CENVAT Credit). - Vendor master data For each of your vendors with the same excise
status from a legal perspective, you define an excise duty indicator. You must also
specify the vendor type – for example, whether the vendor is a manufacturer, a depot, or
a first-stage dealer. You must also stipulate if the vendor qualifies as a small-scale
industry. For each permutation of plant indicator and vendor indicator, you then create a
final excise duty indicator. - Customer master data Similarly, you assign the same excise
duty indicator to each of your customers that share the same legal excise status. Again,
for each permutation of plant indicator and customer indicator, you then create a final
excise duty indicator. - Material master data Each material is assigned a chapter ID. -
Excise tax rate For every chapter ID and final excise duty indicator, you maintain the rate
of excise duty. If your business only qualifies for partial CENVAT credit, you must
customize your system accordingly. Let us consider an example to illustrate how the
system determines which rate of excise duty to apply to a material. Assume you are
posting a sale of ball bearings to a customer. The system automatically determines the
rate of excise duty as follows: 1. Looks up the customer master data to see what status
you have assigned the customer. Let's assume you've assigned the customer status 3. 2.
Looks up the plant master data to see what status you have assigned the plant. Similarly,
your plant has status 2. 3. The system looks up the table under Excise Indicator for Plant
and Customer to see what the final excise duty indicator is for customer status 3 and plant
status 2: It is 7. 4. The system determines the chapter ID of the ball bearing for the plant.
Let’s assume the chapter ID at plant for the ball bearings is 1000.01. 5. Finally, the
system looks up the table under Excise Tax Rate to see what rate of duty applies to
chapter ID 1000.01 under status 7. Define Tax Code for Purchasing Documents - In this
IMG activity, you define a tax code for the purposes of calculating excise duty when you
enter purchasing documents. Only carry out this activity if you use condition-based
excise determination. - Create a new tax code, and set the tax code type to V (input tax).
Do not make any other settings for it. - Assign Tax Code to Company Codes In this IMG
activity, assign the tax code for purchasing documents to the company codes where it will
be used. Only carry out this activity if you use condition-based excise determination.
Classify Condition Types - In this IMG activity, you specify which condition types you
use for which sort of tax. Note that this only applies to condition types that you use with
the new excise determination method. The system uses this information when you create
a document from another one. For example, when you enter an incoming excise invoice
from a purchase order, or when you create an outgoing excise invoice from a sales order,
the system determines the various excise duties in the excise invoice using the
information that you have entered here. In addition, when you create a purchasing
document, the system only uses the condition types that you enter here. - For taxes on
purchases, use the condition types contained in the tax procedure. - For taxes on sales,
use the condition types contained in the pricing procedures. The standard system comes
with sample settings for the tax calculation procedures and pricing procedures. Use these
settings as a basis for your own. IMG > Logistics - General > Tax On Goods Movement
> India > Account Determination Define G/L Accounts for Taxes - In this IMG activity,
you specify which G/L accounts you will use to record which taxes. Requirements - You
have set up G/L accounts for each of the processing keys listed below. - Assign an
account to each of the following posting keys. The accounts for VS1, VS2, and VS3 are
used as clearing accounts during excise invoice verification. - VS1 (basic excise duty) -
VS2 (additional excise duty) - VS3 (special excise duty) - VS5 (sales tax setoff) - MWS
(central sales tax) - MW3 (local sales tax) - ESA (service tax) - ESE (service tax expense)
Specify Excise Accounts per Excise Transaction - In this IMG activity, you specify
which excise accounts (for excise duty and CENVAT) are to be posted to for the various
transaction types. Enter all the accounts that are affected by each transaction type. If you
use sub transaction types, enter the accounts for each sub transaction type as well.
Transaction type UTLZ is used for determining accounts only while posting excise JVs
and also if the payment of excise duty has to be done fortnightly. The fortnightly
CENVAT payment utility picks up the credit side accounts from the transaction types of
GRPO, EWPO, and TR6C for determining the CENVAT and PLA accounts. There is no
separate transaction type for fortnightly payment. Example: - Excise TT DC ind Account
name - GRPO CR CENVAT clearing account - GRPO CR RG 23 BED account - GRPO
DR CENVAT on hld account Specify G/L Accounts per Excise Transaction - In this IMG
activity, you assign the excise and CENVAT accounts to G/L accounts. When you come
to execute the various transactions, the system determines which G/L accounts to post to
by looking at the: - Excise group - Company code - Chart of accounts Furthermore, if you
want separate account determination settings within an excise group, you can also use sub
transaction types. Requirements You have already: - Defined the G/L accounts - Defined
the excise groups - Maintained the transaction accounts Activities - For each excise
group, assign the excise and CENVAT accounts to G/L accounts. For most businesses,
one set of accounts will suffice for all transactions. Note : you need not remit the
CENVAT to the excise department immediately, so maintain the credit account for
transaction type DLFC as an excise duty interim account. This will be set off when you
remit the duty. Config setting needed to be done in order to get the Excise Details Screen
in Material Master. Even though this functionality is available in enterprise version, a
small configuration step has to be made in Screen Sequences for Material Master.
Following document helps you to do this configuration. - Material Master à Logistics
General 1. Go to IMG Define Structure of Data Screen for each Configuring the Material
master Screen Sequence. 2. Select your screen sequence. Usually it would be 21. Select
the same and click on Data Screen in the left frame. 3. Once the data screens are
exhibited, select data screen no. 15, ie. SSq. 21and Scrn 15, which is ’Foreign Trade:
Import Data ’. Select the same and click on Sub screens in the left frame. 4. Go to the last
sub screen i.e. 21-15-6 - SAPLMGD1- 0001 and select the same. Click on tab view sub
screen and ensure that the sub screen is blank. 5. Now in the last sub screen i.e. no.6 you
delete SAPLMGD1 – 0001 and instead add SAPLJ1I_MATERIAL_MASTER and in the
screen no. 2205. 6. Save the setting. 7. Create a Material Master and check whether in
Screen Foreign Trade – Import, Excise related sub screen appears.