EAP: When Both Service Tax and VAT are Applicable, VAT is Calculated on Basis Amount + Service Tax Where it is Supposed to be Calculated Only on Basis Amount (Doc ID 2095303.1)

Last updated on MARCH 18, 2016

Applies to:

PeopleSoft Enterprise FIN Payables - Version 9.2 to 9.2 [Release 9]
Information in this document applies to any platform.

Symptoms

India VAT is calculated on Basis + Service Tax Amount.

SETUP:
Define the dependency code for VAT to include basis amount for calculation of VAT.

STEPS:
1. Create a Voucher for a Supplier who is enabled for India VAT and Service Tax.
2. Save the Voucher.
3. On Invoice Line Excise Duty/Sales Tax / VAT Detail page of the voucher, VAT Amount shown is calculated on the Basis Amount + Service Tax Amount.

EXPECTED BEHAVIOR:
As per Indian taxation rules, VAT should be calculated only on the Basis Amount.

Cause

Sign In with your My Oracle Support account

Don't have a My Oracle Support account? Click to get started

My Oracle Support provides customers with access to over a
Million Knowledge Articles and hundreds of Community platforms