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Procedure documentation Posting Line Items Net of Sales/Purchases Tax Locate the document in its SAP Library structure

Use

When you post documents in Financial Accounting (FI), you can enter them net or gross of sales/purchases tax. The system then calculates the tax accordingly.

Example

Assume you want to issue a customer with an invoice for SGD 1,030, inclusive of SGD 30 tax, which would result in the following postings:

This graphic is explained in the accompanying text

You could post the document using either the net approach or the gross approach. If you use the net approach, you enter SGD 1,000 in the G/L line item. The system then automatically calculates the tax by multiplying the dollar amount by the tax percentage rate (here, 3%) and fills out the tax line items and customer line items automatically. Using the gross approach, on the other hand, you enter SGD 1,030 in the customer line item. The system then calculates the tax by dividing 1,030 by (1 + 3%), and fills out the tax line items.

Prerequisites

Before you can enter line items net of tax, you must set up the user editing options accordingly. You can do so at user master level or at document level.

User Master Level

In the user master Structure link editing options, select the following:

The system will calculate tax using the net approach in all FI documents that this user posts.

This ensures that the system updates the customer or vendor line items based on the total amount of G/L line items.

Document Level

To activate the net approach only on the document level, proceed as follows:

  1. In the user master Structure link editing options, select Propose final amount.
  2. On the Enter Customer Invoice screen, on the Tax tab, choose Net proposal for every document that you want to post using the net approach.

Procedure

To post items net of taxes, follow the following procedure:

  1. In the Items group box, fill out the fields as follows:
  1. On the Basic data tab, enter data as follows:

Caution

Leave the Amount field empty.
  1. On the Tax tab, choose This graphic is explained in the accompanying text Net proposal.

    2. You will see that the tax amount is calculated as SGD 30.

  2. Post the document.
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