Country India : Stock transfer & CST

[former_member405938]

Dear All

As per Central Sales Tax rules, during stock transfer from plant to depot; if customer is known ( e.g. MTO scenario); we have to pay Central Sales Tax during stock transfer.

As we know during stock transfer, we create a stock transfer invoice which is actually a proforma invoice. Therefore, it is not possible to post any accounting document. But to comply with legal requirement; we need to credit CST payable GL Account during stock transfer.

We have tried changing billing document category from "U" (proforma invoice) to "M" (invoice). But this was not successful. It was not possible for us to create ivnoice from "intracompany stock transfer delivery". (Billing document is not created. We do not get any error log also)

Is there any standard solution available in SAP? or making these postings through FI JV is the only available solution?

Regards

Nikhil

[Lakshmipathi]

I feel your findings is wrong. There is no tax when you transfer the goods from a plant to a Depot. Only it is applicable when the goods moved from depot to end customer. Check once again with the client and confirm which rule states this.

thanks

G. Lakshmipathi

[former_member405938]

Dear Sir,

Initially I had the same objection on this requirement.

"Stock transfer is not a sale. So there is no question of any form of sales tax."

But now we have verified that this is a genuine requirement.

Number one , it has come from the controller of the client. Number two, I have also spoken to some of my Tax consultant friends & they have raitified the same.

" If customer is known during stock transfer, CST needs to be paid"

Regards

Nikhil

[Former Member]

Hi

Repeating the same, taxes are not applicable on Stock transfers. Only excise applies.

Can you mention the section,etc. of the rule, if possible.

Thanks

[former_member405938]

Hi

I will check with client & get back to you.

Regards

Nikhil