Excise duty to be inventoried

Question

Hi Gurus,
I have a scenario where excises will be inventoried i.e. will be taken on material cost.At the same time , VAT is deductible.
So during MIGO the following are the postings:
Stock A/c Dr. ( Basic Price + Excises)
Gr/ir clearing A/c Dr. by the same account
But during MIRO the following entries are getting posted,
Vendor Ac Cr.
Gr/Ir clearing A/c Dr ( Material Cost)
Material A/c Dr ( Excises)
VAT Dr
Here  the  VAT amount is different from  the amount in the PO under invoice tab thru tax code.Hence, the total payout is also less.
What might be wrong ? I am planning to check the already existing Tax procedure .
Edited by: Harsh Pravin Shah on Sep 5, 2011 7:07 PM
Also what will be value under the amount column in MIRO after putting the PO as reference.Will it be total of material value + excises , or just the material value from the PO?
Also if it is only the  material value from the PO, does one have to change the amount manually ( material value + excises) so the tax is then calculated  in the correct manner?

Answer 1

Hi,
You have two create a Tax code with Vat as deductable and excise as non deductable.
Suppose, For Tax code Z1 = 10% excise, 2 CESS, 1 % HESS and 5 % VaT(deductable).
T CODE : FTXP
You have to use the following condition for this tax code(T Code FV11)
BED = JMIP with 10%
CESS = JEC2 with 2 %
HCESS = JSEI with 1 %
and for VAT JVRD = 5 %
and assign G/L to VAT in Key JIP5 with T code OB40
Now at the time of GR there will be following entry
Stock material (with Excise) = Dr
GR/IR   = Cr
and at time of IR,
Vendor  = Cr
Vat(GL) = Dr
GR/IR = Dr
Hope Help u !
Regards,
pardeep malik