1. RITES SAP FI End User Manual
F071 – Service Tax for Reverse Charge – Taking
Credit

2. Page 2 of 9 Training ManualSAP FI
20-Dec-2012
Contents
F071 – Service Tax for Reverse Charge – Taking Credit .................................................................1
1 Process overview........................................................................................................................ 3
1.1 Process Flowchart............................................................................................................... 4
1.2 Screen shots........................................................................................................................ 5
1.3 Process steps. ..................................................................................................................... 9

3. Page 3 of 9 Training ManualSAP FI
20-Dec-2012
1 Process overview.
 Goods Transport Agencies/foreign vendors providing services to RITES do not charge service tax on their
Invoice. It is the liability of RITES to calculate service tax on such services and deposit the same – this
mechanism is called reverse charge of service tax.
 Creditforreverse service tax is taken by transferring the admissible charge to the service tax credit account.

4. Page 4 of 9 Training ManualSAP FI
20-Dec-2012
1.1 Process Flowchart

5. Page 5 of 9 Training ManualSAP FI
20-Dec-2012
1.2 Screen shots.
Service tax forreverse charge will be calculatedbySAP ascombinationof Withholdingtax andtax codes.
AssignWithholdingtax codesinVendormaster.
Enter T code XK02 incommandfieldandpressenterkey.
Firstscenario:
Use tax code : SJ
Assignwithholdingtax codesandkeys.
GT GU
ET EU
ST SU
Enter vendor number and
company code.
Activate Withholding tax
radio button.

6. Page 6 of 9 Training ManualSAP FI
20-Dec-2012
Pressenterkey.
ele
Selecttax code SJ when service tax providerisliable underSTrules.
Enter withholding tax codes and keys.
Activate liable radio button.

7. Page 7 of 9 Training ManualSAP FI
20-Dec-2012
SecondScenario:
If service tax provideris not liable under ST rules
Use Tax code SD.
Withholdingtax codesandkeys.
GT GU
ET EU
ST SU
Third Scenario:
Whenservice tax providercharges on full base amount.
Use Tax code:SK
Withholdingtax codesandkeys.
GT GT
ET ET
ST ST
Fourth Scenario:
Whenservice tax providerdoes not charge any service tax.
Use Tax code:SB
Withholdingtax codesandkeys.
GT GT
ET ET
ST ST

8. Page 8 of 9 Training ManualSAP FI
20-Dec-2012
For sponsorshipcharges:
Use Tax code:SY
Withholdingtax codesand keys:
GT GR
ET ER
ST SR
For Import of service (Consultingengineer) :
Use Tax code : SY
Withholdingtax codesandkeys:
GT GR
ET ER
ST SR
Businesssupport service :
Use tax code : SY
Withholdingtax codesandkeys:
GT GR
ET ER
ST SR

9. Page 9 of 9 Training ManualSAP FI
20-Dec-2012
1.3 Process steps.
Step
No.
BBP Process Step Instruction Reference
Service Tax for
Reverse Charge –
takingCredit
01 Analyse Service
Tax Reverse
Charge Creditto
be takena/c.
Service charge reverse charge postingswill happeninSAP
throughthe withholdingtax codesassignedinVendor
master.The calculatedamountscan be view throughthe
FBL3N t code.
02 Checkwhether
any entry isnot
allowed
Service charge reverse charge postingswill happeninSAP
throughthe withholdingtax codesassignedinVendor
master.The calculatedamountscan be view throughthe
FBL3N t code.
F00
9
General Ledger-
posting
GL entriesare passedforchargesthat cannotbe claimedfor
credit.
03 Transferto Credit
account
Allowablechargesare transferredtothe creditaccount.
04 PrintJournal
Voucher
JV for the transferpostingof reverse service charge tocredit
account isprinted.