Summary -

In this topic, we described about the below sections -

Almost every country has some transactions which are non-taxable. The non-taxable transactions can be incoming or outgoing where input or output tax should not apply. For example, Government transactions.

The creation of tax codes for non-taxable transactions includes the below steps -

  • Define 0% input tax
  • Define 0% output tax
  • Assign tax codes for non-taxable transactions

Define 0% Input Tax: -

Below process is to define 0% input tax.

Step-1: Enter the transaction code FTXP in the SAP command field and click Enter to continue.

Assign Tax code to Non taxable transactions

(OR)

Enter the transaction code SPRO in the SAP command field and click Enter to continue.

Assign Tax code to Non taxable transactions

Click on SAP Reference IMG.

Assign Tax code to Non taxable transactions

Expand SAP Customizing Implementation Guide → Financial Accounting → Financial Accounting Global Settings → Tax on Sales/Purchases → Calculations → Define Tax Codes for Sales/Purchases. Click on Execute.

Assign Tax code to Non taxable transactions

Step-2: In the next screen, select the country code and click on right mark.

Assign Tax code to Non taxable transactions

Step-3: In the next screen, enter the new tax code (2-digit alphanumeric) and press Enter.

Assign Tax code to Non taxable transactions

Step-4: Enter the below details in the new dialog box opened ad click on right mark to proceed.

  • Tax code Description – Enter the tax code description
  • Tax Type – Enter V or select input tax type.
Assign Tax code to Non taxable transactions

Step-5: In the next screen, enter the Input tax -Tax Percent. Rate as ZERO and press Enter.

Assign Tax code to Non taxable transactions

Step-6: Once all the details entered, click on the Save button to save the changes.

Assign Tax code to Non taxable transactions

Step-7: Status bar displays the below message once the input zero-percent tax code defined successfully.

Assign Tax code to Non taxable transactions

Define 0% Output Tax: -

Below process is to define 0% output tax.

Step-1: Enter the transaction code FTXP in the SAP command field and click Enter to continue.

Assign Tax code to Non taxable transactions

Step-2: In the next screen, select the country code and click on right mark.

Assign Tax code to Non taxable transactions

Step-3: In the next screen, enter the new tax code (2-digit alphanumeric) and press Enter.

Assign Tax code to Non taxable transactions

Step-4: Enter the below details in the new dialog box opened ad click on right mark to proceed.

  • Tax code Description – Enter the tax code description
  • Tax Type – Enter A or select Output tax type.
Assign Tax code to Non taxable transactions

Step-5: In the next screen, enter the Output tax -Tax Percent. Rate as ZERO and press Enter.

Assign Tax code to Non taxable transactions

Step-6: Once all the details entered, click on the Save button to save the changes.

Assign Tax code to Non taxable transactions

Step-7: Status bar displays the below message once the output zero-percent tax code defined successfully.

Assign Tax code to Non taxable transactions

Technical Information: -

  • Transaction Code: - FTXP
  • Navigation path: - SPRO → SAP Reference IMG → SAP Customizing Implementation Guide → Financial Accounting → Financial Accounting Global Settings → Tax on Sales/Purchases → Calculations → Define Tax Codes for Sales/Purchases


Assign tax codes for non-taxable transactions: -

Below process is assigning 0% input, output tax codes for non-taxable transactions.

Step-1: Enter the transaction code OBCL in the SAP command field and click Enter to continue.

Assign Tax code to Non taxable transactions

(OR)

Enter the transaction code SPRO in the SAP command field and click Enter to continue.

Assign Tax code to Non taxable transactions

Click on SAP Reference IMG.

Assign Tax code to Non taxable transactions

Expand SAP Customizing Implementation Guide → Financial Accounting → Financial Accounting Global Settings → Tax on Sales/Purchases → Postings → Assign Tax Codes to Non-Taxable Transactions. Click on Execute.

Assign Tax code to Non taxable transactions

Step-2: In the next screen, navigate to the specific company and enterinput tax code, output tax code.

Assign Tax code to Non taxable transactions

Step-3: Once all the details entered, click on the Save button to save the changes.

Assign Tax code to Non taxable transactions

Step-4: It prompt for the Change Request. Create/Select the change request and Click on right mark to proceed.

Assign Tax code to Non taxable transactions

Step-5: Status bar displays the below message once the zero-percent tax codes assigned to non-taxable transactions successfully.

Assign Tax code to Non taxable transactions

Technical Information: -

  • Transaction Code: - OBCL
  • Navigation path: - SPRO → SAP Reference IMG → SAP Customizing Implementation Guide → Financial Accounting → Financial Accounting Global Settings → Tax on Sales/Purchases → Postings → Assign Tax Codes to Non-Taxable Transactions
  • Database Table: - T001