Purpose

The purpose of this page is to clarify the understanding of the system logic and requirements in relation to VAT reporting for the Import of Services scenario.

Overview

This page describes the recommendations for G/L Accounts and Tax Codes customizing, steps to create Incoming and Outgoing Tax Invoices related to Import of Services using Parked Tax Invoices Creation Program (J_1UNCREATE_INCOM) and steps to get the correct output in XML form for those Tax Invoices in Register of Incoming and Outgoing Tax Invoices program (J_1UF_REGISTER_IN_OUT).

Introduction

The recommendations for Customizing of Services Import Accounting are relevant only for operations which are taxable according to subparagraph "b" of paragraph 185.1, paragraphs 208.1 and 190.2 of Tax Code of Ukraine.  .

Recommendations for Tax Accounts analytics

Import of Service operation should be reflected both in tax liability and tax credit.

A legal confirmation of of the right to a tax credit for the services received from non-resident  is a registered tax invoice, the tax liability of which is included in the VAT declaration of the corresponding reporting period (subparagraph "g" of paragraph 201.11, paragraph 201.12 of Ukraine Tax Code).

If such a Tax Invoice is registered with violation of the registration period established by the Ukraine Tax Code then tax credit from this Tax Invoice should be reflected in the same period as period of registration in Unified Register of Tax Invoices but taking in account the time limits prescribed by paragraph 198.6 of Ukraine Tax Code.

Given the above, it is proposed to use the following accounts to record operations for the import of services:

- 64402000 «Tax credit without tax invoice - import of services» 

- 64302000 «Settlements for import of services» 

- 64103010 «VAT settlements, import of services» 

- 64103000 «VAT settlements» 

Invoice receipt: 

Document Tax Item:

Tax Invoice issue (tax liability):

Document Tax Item:

Tax Credit reflection (Creation of Incoming Tax Invoice document)

Document Tax Item:

To close balances of Accounts 64103000 and 64103010 transaction FB41 can be used.

Conditions for managing tax accounts 

For the created Accounts some necessary conditions for managing an account are defined:

Accounts 64402000 and 64302000 can be maintained with open items management for additional reconciliation and control.

In case of using of Accounts 64402000 and 64302000 with open items management it is advisable to periodically perform the procedure items clearing. An automatic clearing procedure (F.13 transaction) is possible in case of  filling in the fields involved in the automatic clearing rules. You can fill in the fields using the substitution tools. Analysis of open items along with reconciliation registers will allow accountants to exercise control over VAT accounting.

Tax Codes

It is proposed to allocate separate tax codes that need to be configured as follows (transaction FTXP):

Incoming Tax Codes

OI - for posting of an Invoice from Service Provider

SI - for reflection of tax credit

PD - auxiliary code for reflection of tax credit

Outgoing tax codes

ZI - for reflection of tax liability

DJ - auxiliary code for reflection of tax liability

Reflection of correction for tax liability or tax credit is carried out according to the standard procedure, namely it is necessary to assign target tax codes for the corresponding corrections to auxiliary tax codes PD and DJ.

Program for automatic creation of parked Tax Invoices for import of services (outgoing and incoming)

Program J_1UNCREATE_INCOM (transaction J1UF_PKDTIV). SAP Easy Access menu path:

Accounting → Financial Accounting → General Ledger → Reporting → Tax Reports → Ukraine → VAT → Incoming Tax Invoices → J1UF_PKDTIV - Creation of Parked Incoming Tax Invoices

The program is designed to automatically create parked tax documents based on the relevant documents posted in the system, including tax documents for import of services operations.

Prerequisites

Generation of parked tax documents should be activated according to documentation

For the creation of incoming and outgoing tax documents it is required to configure reasons for special tax codes (SM30:  J_1UFDI_SPTXCODV) in customizing IMG:

Financial Accounting (New) →  General Ledger Accounting (New) → Periodic Processing → Report → Statutory Reporting: Ukraine → VAT Accounting and Reporting → Maintain Reasons for Special Tax Codes

1. Add line for Company code: Document Direction - 1 Incoming Document, TCReason - 145 Non-Resident Vendor INN 5000000000, ender Tax Code for the reflection of tax credit (SI).
2. Add line for Company code: Document Direction - 2 Outgoing Document, TCReason - 145 Non-Resident Vendor INN 5000000000, ender Tax Code for the reflection of tax liability (ZI).

At the selection screen of program J_1UNCREATE_INCOM it is necessary to select the following parameters:

1. Create outgoing TI on import of services
2. Create outgoing TI as parked document
3. Create in Local Currency

Parameters 2 and 3 are selected in case it is needed to make changes in automatically created document.

In case invoice from Vendor was created manually in FI module it is necessary to use the following fields for  service details:

• Item text (SGTXT) of expense account - for filling of service name
• Quantity (MENGE) of expense account - for filling of quantity
• Unit of Measure (MEINS) - for filling of Unit of Measure

Data stored in those fields while creation of parked tax document is transferred to Debit item of account TAXBASE0.

Further processing of created Tax Invoices

To reflect Tax Invoices in Register of outgoing and Incoming Tax Invoices (program J_1UF_REGISTER_IN_OUT, transaction J1UF_IN_OUT) it is required to assign Tax Codes to corresponding columns in transactions OBCG, OBCH for version 'RES' (Tax Code ZI) and 'REP' (Tax Code SI).

More detailed information about customizing needed for reflection of Tax Document in Register of outgoing and Incoming Tax Invoices can be found related SAP Community Wiki page:

Customizing for Tax Base and Tax Amount columns

For correct filling of data for Tax Invoices in electronic XML format and further registration in Unified Register of Tax Invoices please pay attention to additional recommendations provided at following SAP Community Wiki page:

Customizing for FEA code and Service Code in Tax Invoices XML forms

For Tax Invoices with empty requisites of Quantity and Unit of Measure it is needed to fill Tax Code used for Services (ZI) in selected variant for print program J_1UF_PODATKOVA_NACLADNA.

To fill column "Unit of measure of goods/services" of Tax Invoice with text "Послуга" (Service) instead of "Гривня" (UAH) it is required to activate option "Use 'Service' as unit of measure text" in selected variant for print program J_1UF_PODATKOVA_NACLADNA. The data in Tax Invoice Items will be filled then as following:

The created outgoing Tax Invoice (tax liability) should be registered in Unified Register of Tax Invoices. After you get registration receipt or extract from Unified Register of Tax Invoices in electronic format and upload it into the system using program J_1UFDI_PROC_IN the following details of incoming and outgoing Tax Invoices will be updated: Registration status, Registration Date of outgoing and incoming Tax Invoice document. Afterwards it will be possible to create parked incoming Tax Invoice document for the reflection of tax credit on G/L Accounts.

Related Content

Related Documents

Value-Added Tax solution for Ukraine; SAP ERP, SAP S/4HANA

Creation of Parked Incoming Tax Invoices; SAP ERP, SAP S/4HANA

Customizing for Tax Base and Tax Amount columns

Customizing for FEA code and Service Code in Tax Invoices XML forms

Related SAP Notes/KBAs

SAP Note 2406210 - J1UF_IN_OUT. FEA code, Service Code

SAP Note 2409273 - J1UF_IN_OUT. FEA code. Line items text