PURPOSE
The purpose of this document is to define a procedure how to manage VAT exemption for Italy
SCOPE
Domestic Flow – Italy
RESPONSIBILITIES
The customer must get validation from Agenzia delle Entrare and send the original Vat Exemption form to Solvay. The CAM will communicate the exemption to the Customer Service that will maintain the LCIT Condition in SAP.PROCEDURE
PROCEDURE
Receipt of the VAT Exemption
If a customer asks for Exemption to be valid from 01/01, but the license date from Agenzia delle Entrate is 10/01, the validity date will start on 10/01, and all invoices issued before that date would have VAT charged.
VAT exemption is NOT retroactive
A.Identify the customer Number
Search the customer by using his VAT identification and look for the correspondent Payer code.
Use transaction VD03 to search the customer code, and use option: Customers by Tax information
The exemption, is then registered with the Payer code (Account group 0003), NOT the sold-to code
B.How to enter the Exemption in SAP
Transaction VK11
The Customer Service uses Transaction VK11 in order to customize the VAT conditions for the customer in SAP. Below is a description to explain the procedure in SAP.
Enter condition type LCIT
Choose as key combination option 1: Tax: Sales Org. / Customer / country ship-to as indicated below:
- Press enter and complete the following fields
2. Double click on the line to add the amount
3. CSR has now to modify all open orders in order to update the pricing conditions to the new status of “VAT Exempt”. This update is not automatic, we need to go sales by sales and redetermine the MWST output Tax and pull the LCIT condition (VAT license Italy)
If the LCIT condition matches with the planned goods issue, the MWST Tax % must be 0.
The Tax field below the Net value also shows a zero value
If some data do not match between the LCIT dates and the planned goods issue date, the system will not calculate the LCIT condition correctly as in the following screen:
It is necessary to update the pricing conditions:
Choose option G: Copy pricing elements unchanged and redetermine taxes
The system will run a re-calculation and adjust the VAT
Exceptions:
It may also happen that the system is unable to redetermine the LCIT condition.
In this case, it is necessary to check that all dates match with the LCIT validity dates.
In this example, and taking into consideration that the customer is exempt from 01.10.2022 until 31.12.2022, the sales order has two different delivery dates.
The original request was to deliver the product in 01.09.2022 when the customer was not exempt.
Nevertheless, upon his request, it was postpone to 15.12.2022.
Modification is done at item level, but not at the Header, in this situation the exemption will never be active.
Go to Header Data à Billing Document, and change the Serv. Rendered date field so that it corresponds to a date within the LCIT validity range:
Be careful when changing this data, because it is a Header-related field, meaning that it affects all lines of the order.
It is now possible to run the price re-determination again.