customizing iss pis cofins for classic v1 2

7/27/2019 Customizing ISS PIS COFINS for Classic V1 2

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Customizing Guide:New Taxes 2004 (ISS, PIS, COFINS,MP-135 Withholding Taxes)

For Classic (Non-Condition-Based) TaxCalculation

Version 1.2

9 June 2005


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Customizing Guide: New Taxes 2004, Classic Tax Calculation

Content1 Version History.......................................................... ......................................... ............... .... 32 Purpose of This Guide.................................................................... ............... ....... ....... ...... ... 33 Create Condition Types.......................................................... ...................... ....... ...... ....... .... 3

4 Price Conditions Including Taxes..................................................... .......................... ...... ..... 55 Create Entries in J_1BAJ..................................................... ................................. ....... ...... ... 76 Create Processing Keys for FI (T007B)....................................................... ....... ....... ...... ..... 87 Create G/L Accounts.............................................................. ..................................... ....... ... 98 Assign Tax Accounts to Account Keys.............................................. ............................ ....... .99Define Account Keys for SD (T687)..........................................................................................910 Update Calculation Procedures....................................... ......................................... ......... 1011 Customizing of Extended WHT ..................................... ................................ ....... ...... ...... 1312 FI Tax Codes............................................................. ......................................... ............... 1513 SD Tax Codes (View J_1BTXSDCV)................................................................. ...... ....... ..1714 Maintain Settings for External Tax Calculation......................................................... ....... ..1715 Define Tax Jurisdiction Codes......................................................... ................................. .17

16 Assign Jurisdiction Codes to Ranges of Postal Codes................................................... ...1717 Master Data Changes...................................................................... ............... ....... ....... .... 1718 ISS Customizing........................................................................ .................................... .... 1819 Tax Rates....................................................... ......................................... ...................... .... 18

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1 Version History

Document Version Description of Change

1.0 Documented in the customizing Note 747607.

1.1 Downgrade of ISS functionality to the releases 4.0B, 4.5B, and 4.6B

Description adapted for these releases

1.2 Version History introduced

Correction of chapter 12.1.6Modification of chapter 4.3

2 Purpose of This GuideThe purpose of this guide is to describe how to technically set up the system for the new taxfunctions (ISS, PIS, COFINS, and MP-135 withholding taxes). The prerequisite is that allcoding and DDIC changes are already implemented. This means, either the support packagethat contains the changes is installed, or the changes are implemented manually, followingthe instructions of the respective Note. For further details, see overview Note 727475 or overview Note 752440 and the Notes mentioned there.

After implementation of the support package or the Note, there are still manual stepsnecessary to work with the new taxes. These manual steps are described in this guide. It maybe that the changes described in some of the steps are already done in your system (e.g.

entries in table J_1BAJ). In such case, just skip the section.

3 Create Condition TypesNew condition types have to be created for the new taxes. The following classes of conditiontypes are affected:

Tax code conditions (activation of taxes) Conditions with WHT codes (specific for SD)

3.1 Condition Types For Application TX Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Tax on Sales/Purchases -> Basic Settings -> Check Calculation Procedure

-> Define Condition Types and press push button New entries or select an existing entry andpress the push button Copy as Finally, save all new entries.

3.1.1 Tax Code ConditionsCond. Class: D (Taxes)Calculat. Type: A (Percentage)Cond. Category: 1 (Jur. Level 1)Access Seq.: MWSTManual Entries: D (Not possible to process manually)Item Condition: XDelete fr. DB: B (without popup)

Cond. Type Description

ICN3 COFINS Normal TaxICOA COFINS Normal PO/GRICON COFINS Normal Tax

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Cond. Type DescriptionICOO COFINS Offset Tax IncludedICOS COFINS Normal PO/GRICOU COFINS COFINS Normal IV NVVICOV COFINS Offset ICOS/ICOUICOW COFINS WHTICOZ COFINS WHT OffsetICSW CSLL WHTICSZ CSLL WHT OffsetICW3 COFINS Withholding TaxSDICZ3 COFINS WHT SD OffsetIGEW General WHTIGEZ General WHT OffsetIGW3 General WHT SDIGZ3 General WHT SD OffsetIIRW IR WHTIIRZ IR WHT OffsetIPS3 PIS Normal TaxIPSA PIS Normal PO/GRIPSN PIS Normal TaxIPSO PIS Offset Tax Included

IPSS PIS Normal PO/GRIPSU PIS Normal IV NVVIPSV PIS Offset IPSS / IPSUIPSW PIS WHTIPSZ PIS WHT OffsetIPW3 PIS WHT SDIPZ3 PIS WHT SD OffsetIRW3 IR Withholding TaxSDIRZ3 IR WHT SD OffsetISA3 ISS at Provider SDISB3 ISS WHT at Provider SDISE3 ISS at Service Loc SDISF3 ISS WHT at Service Loc SDISSA ISS at Provider

ISSB ISS WHT at Provider ISSE ISS at Service LocISSF ISS WHT at Service LocISSG ISS OffsetISW3 CSLL Withholding Tax SDISZ3 CSLL WHT SD Offset

3.2 Condition Types For Application V Transaction SPRO: SAP Reference IMG -> Sales and Distribution -> Basic Functions ->Pricing -> Pricing Control -> Define condition types -> Maintain Condition Types and presspush button New entries or select an existing entry and press the push button Copy as Finally, save all new entries.

3.2.1 Tax Code ConditionsCond. Class: D (Taxes)Calculat. Type: A (Percentage)Cond. Category: 1 (Jur. Level 1)Access Seq.: MWSTManual Entries: D (Not possible to process manually)Item Condition: XDelete fr. DB: B (without popup)

Tax Type DescriptionICN3 COFINS from SDICW3 COFINS Withholding TaxSDIGW3 General WHT SDIPS3 PIS Normal TaxIPW3 PIS WHT SD

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IRW3 IR Withholding TaxSDISA3 ISS at Provider SDISB3 ISS WHT at Provider SDISE3 ISS at Service Loc SDISF3 ISS WHT at Service Loc SDISW3 CSLL Withholding Tax SD

Cond. Class: D (Taxes)Calculat. Type: A (Percentage)Cond. Category: 1 (Jur. Level 1)Access Seq.: IBRRManual Entries: D (Not possible to process manually)Item Condition: XDelete fr. DB: B (without popup)Ref. Con. Type: ICMORef. Applicat.: V

Tax Type DescriptionICZ3 COFINS WHT SD Offset

IGZ3 General WHT SD OffsetIPZ3 PIS WHT SD OffsetIRZ3 IR WHT SD OffsetISZ3 CSLL WHT SD Offset

Cond. Class: A (Discount or surcharge)Calculat. Type: A (Percentage)Cond. Category:Access Seq.: IBRRManual Entries: D (Not possible to process manually)Item Condition: XDelete fr. DB: B (without popup)Ref. Con. Type: ICMORef. Applicat.: V

Tax Type DescriptionICO2 COFINS Offset SDIPS2 PIS Offset SD

3.2.2 WHT Code ConditionsCond. Class: W (Wage Withholding Tax)Calculat. Type: A (Percentage)Cond. Category: D (Tax)Access Seq.: J1AG (Arg.: Tax Relev. Clas)Manual Entries: D (Not possible to process manually)Item Condition: X

Delete fr. DB: B (without popup)Tax Type DescriptionIKW4 ISS provider WHT cdeILW4 ISS service WHT cdeICW4 COFINS WHT codeIPW4 PIS WHT codeISW4 CSLL WHT codeIRW4 IR WHT codeIGW4 General WHT code

4 Price Conditions Including TaxesThe new solution for tax calculation supports prices which are not the real net prices, but maycontain PIS, COFINS, ISS due at the municipio of the service provider, ISS due at themunicipio of the service execution, or any combination of these.

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In order to allow the system to consider correctly which taxes are already included in a priceand which not, corresponding price conditions should be maintained. It is possible to either continue using existing price conditions or introduce new ones. Of course, if new priceconditions are introduced, all price conditions must be updated.

The following is a suggestion based on 4 new price conditions.

4.1 Price Conditions SDCopy pricing procedure PR0000 to RVXBR2 before creating the conditions:

Transaction SPRO: SAP Reference IMG -> Sales and Distribution -> Basic Functions ->Pricing -> Pricing Control -> Define And Assign Pricing Procedure -> Maintain Pricing Procedure select the entry PR0000 and press the push button Copy as Finally, save allnew entries.

Then create the condition types:

Transaction SPRO: SAP Reference IMG -> Sales and Distribution -> Basic Functions ->Pricing -> Pricing Control -> Define condition types -> Maintain Condition Types and presspush button New entries or select an existing entry and press the push button Copy as

Finally, save all new entries.Cond. Class: B (Prices)Calculat. Type: C (Quantity)Cond. Category: H (Basic Price)Access Seq.: PR00Manual Entries: C (Manual entry has priority)Amount/percent: XItem Condition: XDelete: XPricing Proc: RVXBR2Delete fr. DB: (do not delete)Scale basis: CCheck Value: A descending (Check scale in release 4.5B and 4.0B)

Quantity Conversion: X TextDetPrc: 01 Price Text OD: 0001

Cond. Type DescriptionZPB0 Price w/o TaxesZPB1 Price+ISSZPB2 Price+PIS+COFZPB3 Price+ISS+PIS+COF

4.2 Price Conditions MM If necessary, create new price conditions and adapt the MM pricing procedure for PurchaseOrders (e.g. RM0000) or create new ones by copying and modifying.

4.3 Define Which Taxes Are Included in MM/SD PriceConditionsMaintain for each SD (Application V) or MM (Application M) pricing procedure the taxes thatare included in each price condition type. As an example, the MM procedure RM0000 ismaintained for the pricing conditions PB00 and PBXX the SD procedure RVXBRA ismaintained for the pricing conditions ZPB1 ZPB3.

Transaction SM30: maintain the views J_1BKON1MMVV and J_1BKON1SDVV or alternatively the view J_1BKON1V

Price Condition Tax GroupPB00 COFI COFINSPB00 ISSP ISS at location of service provider PB00 ISSS ISS at location where service is provided

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PB00 PIS PISPBXX COFI COFINSPBXX ISSP ISS at location of service provider PBXX ISSS ISS at location where service is providedPBXX PIS PIS

Price Condition Tax GroupZPB1 ISSP ISS at location of service provider ZPB1 ISSS ISS at location where service is providedZPB2 COFI COFINSZPB2 PIS PISZPB3 COFI COFINSZPB3 ISSP ISS at location of service provider ZPB3 ISSS ISS at location where service is providedZPB3 PIS PIS

Comment: If the pricing procedure contains more than one condition of condition class price ,the last of these conditions is considered.

5 Create Entries in J_1BAJTransaction SM30: maintain the view J_1BAJ

Tax Type Tax Group Description WHT OffsetICN3 COFI COFINS Normal TaxICOA COFI COFINS Normal PO/GRICOF COFI COFINS DeductibleICON COFI COFINS Normal TaxICOO COFI COFINS Offset Tax Included XICOS COFI COFINS Normal PO/GRICOU COFI COFINS COFINS Normal IV NVV

ICOV COFI COFINSOffset ICOS/ICOU XICOW WHCO COFINS WHT XICOZ COFINS WHT OffsetICSW WHCS CSLL WHT XICSZ CSLL WHT OffsetICW3 WHCO COFINS Withholding TaxSD XIGEW WHT General WHT XIGEZ General WHT OffsetIGW3 WHT General WHT SD XIIRW WHIR IR WHT XIIRZ IR WHT OffsetIPIS PIS PIS DeductibleIPS3 PIS PIS Normal TaxIPSA PIS PIS Normal PO/GRIPSN PIS PIS Normal TaxIPSO PIS PIS Offset Tax Included XIPSS PIS PIS Normal PO/GRIPSU PIS PIS Normal IV NVVIPSV PIS PIS Offset IPSS / IPSU XIPSW WHPI PIS WHT XIPSZ PIS WHT OffsetIPW3 WHPI PIS WHT SD XIRW3 WHIR IR Withholding TaxSD X

ISA3 ISSP ISS at Provider SDISB3 ISSP ISS WHT at Provider SD X

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Tax Type Tax Group Description WHT OffsetISE3 ISSS ISS at Service Loc SDISF3 ISSS ISS WHT at Service Loc SD XISSA ISSP ISS at Provider ISSB ISSP ISS WHT at Provider XISSE ISSS ISS at Service LocISSF ISSS ISS WHT at Service Loc XISSG ISSP ISS Offset XISW3 WHCS CSLL Withholding Tax SD X

6 Create Processing Keys for FI (T007B)New processing keys (account keys) have to be created to post taxes to separate accountsand to identify withholding tax amounts in the normal tax calculation.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Tax on Sales/Purchases -> Basic Settings -> Check and Change Settingsfor Tax Processing and press push button New entries or select an existing entry and pressthe push button Copy as Finally, save all new entries.

Tax Type: 2 (input tax)Not deductible: XPosting indicator: 3 (Distribute to relevant expense/revenue items)

Processing Key DescriptionISW ISS WHTWTC COFINS WHTWTG General WHTWTI IR WHTWTP PIS WHTWTS CSLL WHT

Tax type: 2 (input tax)Non deductible: spacePosting indicator: 2 (separate line item)

Processing Key DescriptionCO3 COFINS ClearingPI3 PIS Clearing

Tax type: 1 (output tax)Non deductible: spacePosting indicator: 2 (separate line item)

Processing Key DescriptionCOF COFINSPIS PISWK3 ISS WHTWC3 Cofins WHTWC4 Cofins WHT offsetWG3 General WHTWG4 General WHT offsetWI3 IR WHTWI4 IR WHT offsetWP3 PIS WHTWP4 PIS WHT offsetWS3 CSLL WHTWS4 CSLL WHT offset

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7 Create G/L AccountsIf you need to post the new taxes to separate accounts, create new G/L accounts. Thefollowing is just a suggestion.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Postings -> Define

Accounts for Withholding Tax -> Define Accounts for Withholding Tax to be Paid Over specifythe relevant Chart of accounts and press push button New entries. Finally, save all newentries.

177011: COFINS Withholding Tax Posting at Payment177013: PIS Withholding Tax Posting at Payment177020: CSLL Withholding Tax Posting at Payment177021: IR Withholding Tax Posting at Payment177022: General Withholding Tax (PIS/COFINS/CSLL/IR)177030: PIS Normal Tax177031: COFINS Normal Tax154031: PIS Tax deductible154008: COFINS Tax deductible177040: ISS Withholding Tax

8 Assign Tax Accounts to Account KeysTransaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Tax on Sales/Purchasing -> Posting -> Define Tax Accounts select anentry, specify the relevant Chart of accounts and maintain the G/L account . Finally, save allnew entries.

Posting Keys: 40 50

9Define Account Keys for SD (T687)

Transaction SM30: maintain the view V_T687, Application V

Account Key DescriptionCOF COFINSPIS PISWK3 ISS WHTWC3 Cofins WHTWC4 Cofins WHT offsetWG3 General WHTWG4 General WHT offsetWI3 IR WHTWI4 IR WHT offsetWP3 PIS WHTWP4 PIS WHT offsetWS3 CSLL WHT

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Account Key AccountCO3 154008COF 177031PI3 154031PIS 177030WK3 177040WC3 177011WC4 177011WG3 177022WG4 177022WI3 177021WI4 177021WP3 177013WP4 177013WS3 177020WS4 177020


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WS4 CSLL WHT offset

10 Update Calculation Procedures

10.1 Update Calculation Procedure FI The FI calculation procedure below is based on SAP sample delivery TAXBRJ. The newentries are shown in red . Adapt the calculation procedure that you use in a correspondingway or create a copy of the old one and adapt the new one in order to have a backup.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Tax on Sales/Purchasing -> Basic Settings -> Check CalculationProcedure -> Define Procedure -> select a procedure for maintenance. Finally, save your changes.

New requirements and/or formulas can be created in transaction VOFM.

Step Cntr CTyp Description From To Reqt SubTo Stat AltCTy AltCBV ActKy

100 BASB Base Amount150 Ext. calculation X 320200 Level 200 X210 IPI1 IPI Industr. In 100 521 301 VS1215 IPIF IPI Industr. In 100 521 301 VS1230 ICM1 ICMS Industr. In 100 523 303 VS2231 ICMV ICMS DIFAL Con/Asset 100 523 303 ICD232 ICMT ICMS Difal Investmen 100 523 303 ICD233 ICMP ICMS Difal inv. off. 232 ICC235 ICZG ICMS tax free 100 525 305 NVV240 ICS1 Sub.Tributaria In 100 524 304 VS3250 ICMF ICMS S.T. fr. offset 100 525 305 IC1255 IFR1 ICMS on freight In 100 527 307 VS3256 IFS1 ICMS ST freight In 100 528 308 VS3260 IP1C IPI Ind.Clearing 100 521 301 IPC

265 IP1O IPI Ind.Clear.Off. 210 IPC270 IC1C ICMS Ind.Clearing 100 523 303 ICC275 IC1O ICMS Ind.Clear.Off. 230 ICC300 Level 300 X310 IPI2 IPI Consumption In 100 522 302 NVV330 ICM2 ICMS Consumption In 100 523 303 NVV331 ICMD ICMS Consumption In 100 523 303 NAV340 ICS2 S.T. Consumption In 100 524 304 NVV350 ICOP ICMS complement 100 525 305 ICP355 ICOT STO-ICMS complement 100 525 305 ICP360 ICOX ICMS complement 100 350 ICX365 ISS2 ISS from MM In 100 526 306 NVV366 ISSO ISS from MM In Offs 365 VS1370 ICO1 ICMS compl Transfer 100 160 525 305 ICP

371 ICO2 ICMS compl. Tra. Off 370 160 ICX372 ICO3 ICMS compl. NVV 100 525 305 ICP373 ICO4 ICMS compl. NVV off 372 ICX500 Level 500 X510 IPI3 IPI from SD Out 100 521 301 MW1520 ICM3 ICMS from SD Out 100 523 303 MW2521 ICMM ICMS DIFAL Out 100 523 303 MW2522 ICML ICMS DIFAL ofset out 521 ICC530 ICS3 Sub.Tributaria Out 100 524 304 MW3540 ISS3 ISS from SD Out 100 526 306 MW4541 ICSO SOCIAL Offset TxIncl 540 MW4550 ICZF ICMS Rev (Z.F.)-STO 100 525 305 ICZ560 IFR3 ICMS on freight Out 100 527 307 MW3570 IFS3 ICMS ST freight Out 100 528 308 MW3600 ICM4 STO-ICMS SD (ICM3) 100 523 303 MW2700 Other taxes X710 INSS INSS Incoming 100 VST

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Step Cntr CTyp Description From To Reqt SubTo Stat AltCTy AltCBV ActKy

720 INSX INSS offset (100-) 710 INX

750 PIS, COFINS, ISS X755 ISSA ISS at Provider 100 521 301 NVV760 ISSB ISS WHT at Provider 100 522 302 ISW

765 ISSE ISS at Serv.Loc. 100 523 303 NVV770 ISSF ISS WHT at Serv.Loc. 100 524 304 ISW771 ISA3 ISS at Provider SD 100 521 301 MW4772 ISB3 ISS WHT at Prov. SD 100 522 302 WK3773 ISE3 ISS at Serv.Loc. SD 100 523 303 MW4774 ISF3 ISS WHT Srv.Loc. SD 100 524 304 WK3775 ISSG ISS Offsets 100 525 305 NVV780 ICON COFINS NVV 100 821 801 NVV785 ICOO COFINS NVVOff TxIncl 100 822 802 NVV790 IPSN PIS NVV 100 823 803 NVV795 IPSO PIS NVV Off. TxIncl 100 824 804 NVV797 ICN3 COFINS from SD 100 821 801 COF798 IPS3 PIS from SD 100 823 803 PIS800 WITHHOLDING TAXES ON

GROSSX

805 ICOW COFINS WHT 100 825 805 WTC810 ICOZ COFINS WHT Offset 805 NVV815 IPSW PIS WHT 100 826 806 WTP820 IPSZ PIS WHT Offset 815 NVV825 ICSW CSLL WHT 100 827 807 WTS830 ICSZ CSLL WHT Offset 825 NVV835 IIRW IR WHT 100 828 808 WTI840 IIRZ IR WHT Offset 835 NVV845 IGEW General WHT 100 829 809 WTG850 IGEZ General WHT Offset 845 NVV851 Withholding Tax from SD X852 ICW3 COFINS WHT SD 100 825 805 WC3853 ICZ3 COFINS WHT Offset SD 852 WC4855 IPW3 PIS WHT SD 100 826 806 WP3856 IPZ3 PIS WHT Offset SD 855 WP4858 ISW3 CSLL WHT SD 100 827 807 WS3859 ISZ3 CSLL WHT Offset SD 858 WS4860 IRW3 IR WHT SD 100 828 808 WI3861 IRZ3 IR WHT Offset SD 860 WI4864 IGW3 General WHT SD 100 829 809 WG3865 IGZ3 Genera WHT Offset SD 864 WG4900 COFINS reduce stock X901 ICOV Cofins Offset 100 D 822 802 CO3905 ICOS COFINS deduct. PO/GR 100 160 831 801 CO3906 ICOU Cofins IV Non Deduct 100 161 831 801 NVV907 ICOA Cofins ded. not inc. 100 841 801 CO3910 PIS Reduce stock X911 IPSV Offset IPSS / IPSU 100 E 824 804 PI3

915 IPSS PIS deduct. PO/GR 100 160 833 803 PI3916 IPSU PIS non deductib. IV 100 161 833 803 NVV918 IPSA PIS ded. not inc. 100 843 803 PI3

10.2 Update Pricing Procedure SDThe below SD pricing procedure is based on SAP sample delivery RVXBRA. Examples for other procedures (like RVXBRE etc.) are not given, since the changes are the same. The newor changed entries are shown in red . Adapt the calculation procedures that you use in acorresponding way or create copies of the old ones and adapt the new ones in order to havea backup.

Transaction SPRO: SAP Reference IMG -> Sales and Distribution -> Basic Functions ->Pricing -> Pricing Control -> Define and assign pricing procedures -> Maintain pricing

procedure -> select a procedure for maintenance. Finally, save your changes.

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New requirements and/or formulas can be created in transaction VOFM.

Step Cntr CTyp Description From To Man. Reqt SubTo Stat AltCTy AltCBV ActKy Print

10 Price 2 X10 1 ZPB0 Price w/o Taxes X

10 2 ZPB1 Price+ISS X10 3 ZPB2 Price+PIS+COF X10 4 ZPB3 Price+ISS+PIS+COF X45 X50 RB00 Discount (Value) 2 X

290 K X300 ICMI Price+Tax (for NF) 2 323 ERL X320 K004 Material 2 ERS321 K007 Customer Discount 2 ERS322 K005 Customer/Material 2 ERS329 320 328400 KF00 Freight ERS595 590600 IBRX Brazil tax calc. 595 596 X 320610 IPI3 IPI from SD X 521 301 MW1620 ICM3 ICMS from SD X 523 303 MW2630 ICS3 Sub.Trib. from SD X 524 304 MW3650 ICZF ADMS Disc. Zona Fr. X 525 305 MWS660 IFR3 ICMS on freight SD X 527 307 MW3670 IFS3 ICMS ST freight SD X 528 308 MW3675 ISS3 ISS from SD X 526 306 MW4680 ISA3 ISS at Provider SD X 521 301 MW4681 ISB3 ISS WHT at Prov. SD X 522 302 WK3682 ISE3 ISS at Serv.Loc. sd X 523 303 MW4683 ISF3 ISS WHT Srv.Loc.

SDX 524 304 WK3

684 ICSO ISS offset 675 683 BRI685 ICN3 COFINS from SD X 821 801 COF686 ICO2 COFINS Offset SD 685 BRI

687 IPS3 PIS from SD X 823 803 PIS688 IPS2 PIS Offset SD 687 BRI700 Total Tax Value 610 690 X720 ICMO ICMS offset 620 BRI740 DIFF Rounding Off 13 16 4 ERS750 4 X799 R100 100% discount 750 55 28 ERS800 SKTO Cash Discount 9 X 11810 VPRS Cost 4 B X960 Withholding taxes X961 ICW3 COFINS WHT SD X 825 805 WC3963 ICZ3 COFINS WHT SD

offset961 X WC4

965 IPW3 PIS WHT SD X 826 806 WP3967 IPZ3 PIS WHT SD Offset 965 X WP4970 ISW3 CSLL WHT SD X 827 807 WS3972 ISZ3 CSLL WHT SD offset 970 X WS4975 IRW3 IR WHT SD X 828 808 WI3977 IRZ3 IR WHT SD offset 975 X WI4979 IGW3 General WHT SD X 829 809 WG3980 IGZ3 Genera WHT SD

offset979 X WG4

985 Withholding taxes:Tax codes

X

986 ICW4 COFINS WHT code 963 983 X987 IPW4 PIS WHT code 965 983 X988 ISW4 CSLL WHT code 972 983 X989 IRW4 IR WHT code 975 983 X990 IGW4 General WHT code 979 983 X

991 IKW4 ISS provider WHTcde

681 983 X

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Step Cntr CTyp Description From To Man. Reqt SubTo Stat AltCTy AltCBV ActKy Print

992 ILW4 ISS service WHT cde 683 983 X

The SD pricing procedure below is the new price supplement procedure RVXBR2 which isintroduced for the optional new price conditions. It can be configured in the following way:

St C CTyp Description Fr o

To M M S P S Req A.C

A.B.

Act.K

10 1 ZPB0 Price w/o Taxes10 2 ZPB1 Price+ISS10 3 ZPB2 Price+PIS+COF10 4 ZPB3 Price+ISS+PIS+COF40 1 RA00 % Discount from Net40 2 RB00 Discount (Value)40 3 RC00 Quantity Discount40 4 RD00 Weight Discount

11 Customizing of Extended WHTTransaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Calculation ->Withholding Tax Types -> Define Withholding Tax Types for Payment Posting -> specify acountry key (BR for Brazil) and press push button New entries or select an existing entry andpress the push button Copy as Finally, save all new entries.

11.1 WHT Types at Payment Base amount = Modified Tax AmountRounding rule = W/tax comm roundCash Discount = C/disc pre W/txPost w/tax amount = XNo accumulationW/tax base manual = XManual w/tax amount = XNo cert numbering = XBase amount = W/tax code levelWithholding tax amount = W/tax code levelNo central invoiceMinimum Check at item level

W/Tax Type DescriptionCP COFINS at PaymentGP General WHT (PIS/COF/CSLL/IR) at PaymentPP PIS at PaymentRP IR at PaymentSP CSLL at Payment

11.2 WHT Types at InvoiceTransaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Calculation ->Withholding Tax Types -> Define Withholding Tax Types for Invoice Posting -> specify acountry key (BR for Brazil) and press push button New entries or select an existing entry andpress the push button Copy as Finally, save all new entries.

Base amount = Modified Tax AmountRounding rule = W/tax comm roundPost w/tax amount = XNo accumulationW/tax base manual = X

Manual w/tax amount = XNo cert numbering = XBase amount = W/tax code level

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Withholding tax amount = W/tax code level

W/Tax Type DescriptionIW ISS WHT

11.3 WHT CodesTransaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Calculation ->Withholding Tax Codes -> Define Withholding Tax Codes -> specify a country key (BR for Brazil) and press push button New entries or select an existing entry and press the pushbutton Copy as Finally, save all new entries.

Percentage subject to tax: 100,00%With/tax rate: 100,00%Posting indicator: 1

W/Tax Type W/Tax Code DescriptionCP CP COFINS 100% WHT AmountGP GP General 100% WHT AmountIW IW ISS 100% WHT AmountPP PP PIS 100% WHT AmountRP RP IR 100% WHT AmountSP SP CSLL 100% WHT Amount

11.4 Define Processing Key For Modified Tax Amount Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Calculation ->Withholding Tax Base Amount -> Define Processing Key for Modified Tax Amount -> specifya country key (BR for Brazil) and press push button New entries or select an existing entryand press the push button Copy as Finally, save all new entries.

WHT Type Processing KeyIW ISWIW WK3CP WTCCP WC3PP WTPPP WP3SP WTSSP WS3RP WTIRP WI3GP WTGGP WG3

11.5 Assign WHT Types to Company CodesIn IMG, assign all relevant WHT types to all Brazilian company codes that are subject to them.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax -> Company Code -> AssignWithholding Types to Company Code -> press push button New entries or select an existingentry and press the push button Copy as Finally, save all new entries.

To activate for MM, flag With/tax agent in vendor data and assign validity.

To activate for SD, flag Subject to w/tax in customer data.

11.6 Define Accounts for Withholding Tax to Be Paid Over Assign G/L accounts for WHT to WHT types.

Transaction FSP1

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12.1.2 To activate PIS non-deductible:Rate (%) Cond. Type Description Tax Group Acct. Key

100 IPSN PIS NVV Normal Tax PIS NVV100 IPSO PIS NVV Offset Tax Included PIS NVV

12.1.3 To activate COFINS deductible:Rate (%) Cond. Type Description Tax Group Acct. Key

100 ICOV COFINSOffset ICOS/ICOU COFI CO3100 ICOS COFINS Normal PO/GR COFI CO3100 ICOU COFINS Normal IV NVV COFI NVV100 ICOA COFINS Normal PO/GR COFI CO3

12.1.4 To activate PIS deductible:

Rate (%) Cond. Type Description Tax Group Acct. Key100 IPSV PIS Offset IPSS / IPSU PIS PI3100 IPSS PIS Normal PO/GR COFI PI3100 IPSU PIS Normal IV NVV COFI NVV100 IPSA PIS Normal PO/GR COFI PI3

12.1.5 To activate withholding taxes:Rate (%) Cond. Type Description Tax Group Acct. Key

100 ICOW COFINS WHT WHCO WTC100 ICOZ COFINS WHT Offset NVV100 IPSW PIS WHT WHPI WTP100 IPSZ PIS WHT Offset NVV

100 ICSW CSLL WHT WHCS WTS100 ICSZ CSLL WHT Offset NVV100 IIRW IR WHT WHIR WTI100 IIRZ IR WHT Offset NVV100 IGEW General WHT WHT WTG100 IGEZ General WHT Offset NVV

12.1.6 To activate ISS New 2004:Rate (%) Cond. Type Description Tax Group Acct. Key100 ISSA ISS at Provider ISSP NVV100 ISSB ISS WHT at Provider ISSP ISW100 ISSE ISS at Service Loc. ISSS NVV100 ISSF ISS WHT at Service Loc. ISSS ISW100 ISSG ISS Offsets ISSP NVV

12.2 Usage Indicator for Tax CodesTax codes used for the taxation of services must have the service flag set.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Taxes on Sales/Purchases -> Calculation -> Settings for Tax Calculation in

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Brazil -> Additional Standard Tax Codes -> select the check box in column Service wererequired. Save all new entries.

13 SD Tax Codes (View J_1BTXSDCV) Activate additional taxes for SD tax codes by flagging the relevant taxes on the existing SD

tax codes or on newly created ones.

14 Maintain Settings for External Tax Calculation

14.1 Structure for Tax Jurisdiction Code (View V_TTXD)New entry for TAXBRJ. Level1 = 3, level2 = 4.

14.2 Activate External Tax CalculationFor calculation procedure TAXBRJ, specify ext. system C.

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings ->Tax on Sales/Purchasing -> Basic Settings -> External Tax Calculation ->

Activate External Tax Calculation . Finally, save all new entries.

14.3 Define Logical DestinationFor ext. system C, specify:

Transaction SPRO: SAP Reference IMG -> Financial Accounting -> Financial Accounting Global Settings -> Withholding Tax -> Extended Withholding Tax ->Calculation -> Withholding Tax Types -> Define Logical Destination ->

C JUR J_1BTAXJUR_DETERMINE_NEW

C TAX J_1BCALCULATE_TAXES

15 Define Tax Jurisdiction CodesFor new ISS calculation, two-level jurisdiction codes should be maintained.

The proposal is to use the first three digits for the state (e.g. SP for Sao Paulo) and the lastfour digits to define the municipio. A suggestion is to use the digits 4 through 7 of the IBGEcode for this. As an example, SP 5030 would be the municipio of SAO PAULO, SP 4850the municipio of SANTOS, etc.)

Transaction SM30: Maintain view J_1BTXJURV

16 Assign Jurisdiction Codes to Ranges of PostalCodesFor proper tax jurisdiction code validation and value help, assign valid ranges of postal codesto the newly created tax jurisdiction codes.

Transaction SM30: Maintain view J_1BTREG_CITYV

17 Master Data ChangesThere are changes to master data necessary in order to correctly effectuate the new taxcalculation.

17.1 Vendors (Transaction XK02)

Assign all WHT types and codes that are applicable.

Update address with new tax jurisdiction code for correct ISS calculation.

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17.2 Customers (Transaction XD02)

Assign all WHT types and codes that are applicable.

Update address with new tax jurisdiction code for correct ISS calculation.

17.3 Other Address Changes: Organizational StructureIn order to allow correct calculation of ISS, all relevant adresses must be updated with thenew Jurisdiction codes. This is necessary for:

Company Codes

Plants

Business Places (Filial)

General addresses of central address management that are used as deliveryaddresses

18 ISS CustomizingDetails about the ISS Customizing logic can be found in the ISS documentation. Here, only anoverview of the necessary Customizing steps is given.

18.1 Tax LawsView: J_1BATL3V. Maintain definitions for ISS tax laws.

18.2 Official Service TypesDefine official service types for purchasing (view J_1BSERVTYPES1V) and sales (viewJ_1BSERVTYPES2V) processes.

18.3 Generic Service TypesDefine generic service types in view J_1BGENSERVTV.

18.4 Assign Official Service Types Assign official service types as needed:

to generic service types (view J_1BSERVASSIGN1V) to material numbers (view J_1BSERVASSIGN2V)

19 Tax Rates

19.1 COFINS Maintain entries in transaction J1BTAX (R/3 4.7 or higher) or view J_1BTXCOFV. Use the taxgroups of dynamic exceptions you created.

19.2 PIS Maintain entries in transaction J1BTAX (R/3 4.7 or higher) or view J_1BTXPISV. Use the taxgroups of dynamic exceptions you created.

19.3 ISS Maintain entries in transaction J1BTAX (R/3 4.7 or higher) or view J_1BTXISSV. Use the taxgroups of dynamic exceptions you created.

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19.4 Withholding TaxesMaintain entries in transaction J1BTAX (R/3 4.7 or higher) or view J_1BTXWITHV. Use thetax groups of dynamic exceptions you created.

You define either a general WHT collection code and a combined rate or the four individualwithholding taxes separately.

customizing iss pis cofins for classic v1 2

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