Input Tax Distribution

Definition

In the advance return for sales tax, the output tax posted is periodically balanced against the deductible input tax to calculate the tax amount that a company has to pay. In many countries, it is only possible to report the output tax paid and/or the input tax paid (deferred tax). Since the deductible share of input tax is generally not yet known at the time when the costs are posted, the entire input tax amount is posted when the incoming invoice in created. For this posting, the accountant can define the target account assignment:

Costs that are to be capitalized are assigned to a fixed asset.

Costs that can be apportioned to the tenant are assigned to settlement units.

Non-apportionable costs that do not have to be capitalized can be assigned to the real estate objects where they originate.

Other real estate costs that are not assigned directly to real estate objects are assigned to the objects where these costs originate. These other objects (such as, functional location or CO order) can be linked to real estate objects. For example, maintenance orders are usually linked to the real estate object by means of the functional location assigned to it. Internal orders and projects can be assigned directly to a real estate object.

For these costs, input tax is divided into deductible and non-deductible shares by taking into account the changing situation (ratio of commercial to residential rental) of the account assignment objects. This division is controlled by the option rate , which can be determined per real estate object and per period ( Option Rate Determination ). Deductible and non-deductible input tax are posted to the accounts you set in Customizing.

General Prerequisites

Customizing

The company code in which the input tax distribution is to be performed opts for input tax. If the company code does not opt for input tax, the input tax is always posted as 100% deductible.

Set the CoCd Opts (Company Code Opts for Input Tax) indicator in Customizing. Choose:

SAP Customizing Implementation Guide → Flexible Real Estate Management → Basic Settings → Make Basic Settings in Company Code

Also specify the object types, for which you want input tax distribution to be made. If the company code opts, you should select all object types that are related to real estate.

This graphic is explained in the accompanying text.

For company codes that do not opt for input tax, the option rate can be determined using the selected option rate method and then saved, but there is no input tax distribution.

You specified which object types are allowed to be assigned to other objects. In Customizing, choose:

SAP Customizing Implementation Guide → Flexible Real Estate Management → General Settings for Master Data and Contract → Assignment of Objects from Other Components → Assign Functional Locations/Fixed Assets/Projects/CO Orders

In Customizing for Financial Accounting , the sales tax indicator is defined and is assigned to the corresponding tax type and tax group in Customizing for Flexible Real Estate Management. Choose:

SAP Customizing Implementation Guide → Flexible Real Estate Management (Enterprise Extension )→ Accounting → Integration FI-GL, FI-AR, FI-AP → Taxes → Assign Tax Codes and Assign Tax Codes (for FI Document).

Accounts are set up for posting deductible and non-deductible input tax. Proceed as follows:

In Customizing for Financial Accounting , you defined tax accounts. Choose:

SAP Customizing Implementation Guide → Financial Accounting → Financial Accounting Global Settings → Tax on Sales/Purchases → Posting → Define Tax Accounts.

In Customizing for Flexible Real Estate Management , you defined account symbols and assigned them to the appropriate flow types by choosing:

SAP Customizing Implementation Guide → Flexible Real Estate Management ® Accounting → Automatically Generated Accounting Documents → Account Determination → Account Symbols and Assign Account Symbols to Flow Type

These account symbols are assigned to the corresponding G/L accounts. Choose:

SAP Customizing Implementation Guide → Flexible Real Estate Management → Accounting → Integration FI-GL, FI-AR, FI-AP → Account Determination → Replace Account Symbols

For the account assignment of non-deductible input tax, you assigned the appropriate accounts. Choose:

SAP Customizing Implementation Guide → Flexible Real Estate Management → Option Rate Determination and Input Tax Distribution → Account Determination for Non-Deductible Input Tax per Cost Element

If you want to process line items with multilevel tax codes in input tax distribution, then you defined the distribution for the multilevel tax codes by choosing:

SAP Customizing Implementation Guide → Flexible Real Estate Management → Option Rate Determination and Input Tax Distribution → Input Tax Distribution with Multilevel Tax Code

Additional Requirements

For each object for which an input tax distribution is to be performed, option rates must be determined each month using the option rate method assigned to the object.

For more information, see Option Rate Determination .