Imposto Sobre Servicos (ISS) 

Introduction

ISS is a municipal tax on services. The tax rate is determined by the city of the supplier and the type of service.

One exception includes construction companies that use the ISS rate of the city where they are building/working. The exception for construction companies is currently not in scope for the localization. The ISS tax amount is normally included in the service price.

The calculation of ISS is only relevant on the outgoing side (SD) because the ISS amount has to be stored in the Nota Fiscal database for reporting purposes. On the incoming side (MM), the ISS amount is not posted as an ISS credit but is included in the service price. Therefore, no ISS calculation is necessary in MM. ISS is not stored in the Nota Fiscal database on the incoming side. On the incoming side, no ISS related reporting is necessary.

Rate Determination (only SD)

ISS rates are derived via the following parameters and tables:

The SD pricing procedure uses the indicator Calculate ISS of the SD tax code to determine whether ISS must be calculated. SD tax codes are specified in the sales order on line level.

ISS rates are defined date-dependent. The rate is defined per material. You can maintain the rates by choosing the Customizing path for ISS.