2977615 - GST India TCS Scenario: How to Post the Documents with TCS Tax Codes for Sales Documents

As per the new legal change, tax collected at source (TCS) must be collected at the time of receiving the sale consideration: As part of this change, while posting the invoice,

• the TCS tax lines will be posted to the deferred/interim general ledger (GL) account,
• the movement of the TCS tax lines from the interim GL account to actual GL account will occur at the time of invoice payment.

Going forward, an error will occur at the time of the invoice posting if you have not maintained the deferred/interim tax GL account for the output tax against the tax type TCS in the chart of accounts.

Error message: 'Account determination is missing for item type Deferred Output Tax'

Affected tax codes: 593 to 603 (both included)

Country: India

SAP Business ByDesign

1. Go to the Customer Invoicing work center.
2. Go to the Invoice Requests view.
3. Select invoice request XYZ (XYZ represents name of the Invoice Request).
4. Choose the Invoice button and Release the document as an invoice. 

The following error message appears: 'Account determination is missing for item type Deferred Output Tax.'

You are using TCS related tax codes in the Customer Invoice and you have not maintained the deferred/interim tax GL account for the output tax against the tax type TCS in the chart of accounts.

SAP has delivered the following tax codes for TCS:

• 593 - Domestic Sale Interstate - IGST + TCS (Calc. incl. GST)
• 594 - Domestic Sale Intrastate - CGST + SGST + TCS (Calc. incl. GST)
• 595 - Domestic Sale UT - CGST + UTGST + TCS (Calc. incl. GST)
• 596 - Kerala Sale Intrastate - CGST + SGST + KFC + Compensation Cess + TCS (Calc. incl. GST)
• 597 - Merchant Export - Interstate - IGST + TCS (Calc. incl. GST)
• 598 - Merchant Export - Intrastate - CGST + SGST + TCS (Calc. incl. GST)
• 599 - Export Sale - IGST + TCS (Calc. incl. GST)
• 600 - Deemed Export Sale EOU - IGST + TCS - Taxable (Calc. incl. GST)
• 601 - Export Sale - IGST + TCS - LUT/Bond (Calc. incl. GST)
• 602 - GST Export Sale - SEZ including TCS (Calc. incl. GST)
• 603 - Sales to SEZ - IGST + TCS - LUT/Bond (Calc. incl. GST)

These tax codes are available in all tax code relevant documents such as customer invoice, credit memo, debit memo and down payments.

To post a document using the new tax codes, follow the steps below:

Prerequisite:

You have to maintain the deferred/interim tax GL account for output tax against the tax type TCS in the chart of accounts. To maintain this, follow the below steps below:

1. Go to the Business Configuration work center.
2. Select your implementation project and click on Open Activity List.
3. Select the Charts of Accounts, Financial Reporting Structures, Account Determination fine tuning activity.
4. Select Tax under Accounting Determination.
5. Find the Account Determination Profile and navigate to the Output Tax tab.
6. Maintain the GL account in the Deferred output tax against tax type TCS.

Process flow:

1. Create a customer invoice using the TCS tax code.

    2.  Once the invoice is released check the journal entry posting for the invoice. The TCS tax lines should get posted to deferred GL account.

   3. Once the invoice payment is done for the customer invoice, check in the journal entry to view TCS tax amounts move from interim GL account to actual GL account.

2975267 - You Expect a TCS Relevant Tax Code to Be Determined Automatically in a Sales Document

2977201 - TCS Field Missing in the Customer Invoice Form Template

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