Frequently many companies in Brazil are implementing SAP or doing roll outs on their current ERP migrating to SAP or even adding new companies to their existing SAP and etc.
There are so many details to take care that are more related to the business, if the existing process will work properly on SAP or how to handle something that company that is being rolling out is doing that the existing company on SAP does completely different.
There are also all the legal requirements already in progress such as NFe, SPED, Incoming NFe, Social SPED, FCI, Federal, State and Municipal obligations, CTe and etc.
Even with all the planning, some customers don’t think about the core of all the Brazilian Tax Calculation, the Tax Schema (TAXBRJ x TAXBRA).
Some companies doesn’t see the importance on updating their Tax Schema Calculation and they think that they will save money and time if they just don’t update to the TAXBRA and keep using TAXBRJ. This is a terrible mistake and I will tell you why: In 2005 SAP started introducing the usage of the TAXBRA recommending that new customers on new implementations use the TAXBRA instead implementing TAXBRJ and also, recommended customers start considering upgrade their tax schema.
There are several reasons why SAP recommend your company use TAXBRA: It is more robust, easy to handle and meet taxes requirements, designed to meet the MP135, ISS and WHT cumulative, but more important than that, SAP giver priority releasing standard solution to the law changes and new legal requirements released by the government frequently. Besides that, SAP will discontinue the support to the TAXBRJ sooner or later.
Soon companies will realize that saving costs and time wasn’t worth, since they will have to spend lot time adapting TAXBRJ to the new legal requirements that are not standard released by SAP. And it will be worse when the support is discontinued. Companies will have to handle taxes issues without counting on SAP support.
One other terrible mistake that companies do is not choosing the right resources for upgrading or implement TAXBRA, this happens more often with foreign countries, where they have a centralized support team that still thinks that the Tax Calculation Schema in Brazil is maintained by FICO team. This is easy to understand since Brazil is the only country in Americas where the taxes are maintained by SD and MM.
Upgrading or even implementing TAXBRA could take from 1 to 4 months usually; it depends on the size of the company, resources focused to the project, existing processes, number of different tax codes, number of pricings, taxes exceptions and etc.
Even though implementing TAXBRA is 80% on SD/MM, a perfect team for this job should consider: MM, SD, FI, CO, ABAP, BASIS and a Project Manager.
Tasks related to the TAXBRA are:
CBT activation, Configure Tax Codes, Tax Groups, Dynamic Exceptions, Tax Rates, Condition Types, Account Keys, Condition Records, Access Sequences, Condition Codes, Tax Jurisdiction, Screen Controls, Conditions Mappings, Tax Posting Strings, internal codes, Price conditions, TAXBRA/RVABRA pricing adjustments, MP135, ISS, WHT, all this maintained by MM and SD consultant, and it is always good to check CFOP, Jurisdiction Codes, Tax Laws, Tax Situations, and etc.
A FICO consultant must setup the Withholding taxes on payment (since the WHT on Invoice is maintained by MM) and must configure the taxes account determination (OB40) and the conditions relevant for CO-PA, CO-PC and etc.
The secret of success is always experienced consultants working with experienced key users from fiscal department. Tests and users acceptance tests must be done carefully and include all the different processes and situation current in use.
FI/CO/ABAP/BASIS and PM can be part time for a project like this while MM and SD must be full time assigned to this job.
Security must be checked since there are new conditions and accesses on J1BTAX that must be considered.
For general information about the SAP strategy on TAXBRA condition-based tax calculation for Brazil and SAP recommendations, refer to the note 1538088
TAXBRA additional information:
• FTXP is no longer used. Maintain existing tax codes or creating new tax codes must be done via J1BTAX only
• Conditions are activated via FV11/FV12 with amount 100%
• Maintaining J1BTAX tax tables or tax codes conditions the system generates automatically condition records for these data
• The generation of condition records occurs during maintenance of tables J_1BTX*
• Main notes: 664855, 727475, 747607, 916003, 947670
- Using the method of Tax Calculating via condition based technique (CBT), every time a new tax group is created, it must be added in a certain access sequence, automatically by the system through the transaction J1BTAX. The same should occur whenever changes are performed in the tax groups, or even it is deleted
If you want to know more, write a comment on this post.
Copyright Notice: © Leandro da Pia Nascimento and SAPBR.COM (SAP BRAZIL) WordPress Blog, 2013. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Leandro da Pia Nascimento and SAPBR.COM with appropriate and specific direction to the original content.
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Dear Sir,
In case that we implement only FI/CO module in our system, no MM/SD, is TAXBRA still recommended or we can just apply TAXBRJ?
with best regards,
Jittima
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Hi, Thanks for the great informative Post.
I need to know , how are Import duties handeled in Purchasing in Brazil. Is it controlled by the Tax procedure? or by the Pricing Procedure? and what duties are required.
2. Is standard Vendor consignment process sufficient for Brazil? or is there some localization required there as well?
-RVJ
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There are few taxes on purchasing, mainly ICMS, IPI, PIS, COFINS for goods, ICMS for freight, and ISS for Services, without mention the WHT.
Depending on the usage of the product (Consumption/Expense, Industrialization/Manufacturing, Resale, or Fixed Asset) the behavior of these taxes change in the PO, and also de calculation. Taxes can also be recoverable (credit) or non recoverable.
On the procurement side, the taxes are handled via tax procedure/Tax Schema, and the most updated tax schema for Brazil is the TAXBRA;
The Consignment process in BRazil is unique for Brasil, I mean, the Global Consignment process doesn’t fit all local legal requirements. There are especial movement types for GR (821) and tax codes for this process.
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Thanx a Lot for your reply, I hope I can Bother you a bit more as and when I have more such Doubts. Just not able to find much good documentation online regarding Brazil Localization from System config and transcational point of view.
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Thank you for a detailed post explaining various terminologies used in Brazil.
I had a question on NFS-e. Could you please provide the different steps that need to be considered while implementing NFS-e on the SD side.
Thank you,
Ravi
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Hi Leandro,
Any ideas about REPNBL tax exemption configuration , Just want some hints what all activities are to be done .
I am sure you already know about it ,however I will just add the details .
We have to implement REPNBL tax exemption in brazil which is IPI, PIS, COFINS exemption for the telecommunication industry for improving communication infrastructure.
Thanks in advance,
Naval
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Naval, I didn’t have chance to go through all the details on the REPNBL, but if you need to do the IPI, PIS and COFINS exemption to the customer, you should be able to do that using the concept of Tax Groups (J_1BTXTAXGRUOP) and Tax Dynamic Exceptions (J(J_1BTXIP1, J_1BTXCOFV and J_1BTXPISV). If you don’t want enter those exceptions customer by customer, you might be able to do that using other fields on TAXGRUOP if your customers are sorted for example based on industry type…
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Hi Leandro,
Yes, Based on the govt regulation only customers from telecommunication industry can avail this tax exemption.
The issue is, That in each sales order created for a project there can be several line items and not all the materials may be approved by the govt. for the exemption.
So each line item has to be dealt individually .
If that was not enough, Same customer may not get approval for another project with same materials 🙂 .. which makes its tricky to do automatic determination .
Do you think if we request users to change tax codes for the approved line items(Read materials) manually when creating the SO , Will it work ???
If Yes , Please suggest what all activities are to be done (Just a hint, Please )???
Kind Regards,
Naval
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Check my post: https://sapbr.com/2015/01/15/customers-and-vendors-new-fields-nfe-3-10/
You have some options… you can for example use the Industry Type in your customer master records as a key to the J_1BTXGRUOP and create the dynamic exception based on Industry Type + NCM.. I am saying NCM because when the government approves one group of products to be affected by a special tax rate or exemption, this is usually done by NCM. So, instead creating exception to each customer + NCM, you may want do based on industry type + NCM… Of course, you will need to maintain customer master records with proper industry type.
BUT, since you said the same material may be approved or not depending on the project, that’s definitely tricky. I am thinking here, you can do exception based on sales order type… I mean, it will be an user decision.. if for that project he is approved to the exception, go to Order type XYZ… You may need research online on how to do dynamic exception based on sales order…I don’t have any document here now.
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Hi,
We are not using MM or SD. SAP is mainly used as financial system. There will be interfaces with existing Procurement and distribution systems. But tax codes needs to be maintained as there will be some misc. billing and purchases directly booked in SAP. So can you please advise –
1. should we still go with TAXBRA
2. There are no SD or MM consultants so should we (FICO) consultant maintain the tax codes using J1BTAX?
3. Can you please suggest anything specific we need to keep in mind?
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You should absolutly go for TAXBRA. You’ll need to configure the Tax Codes via J1BTAX and activate the conditions via FV11/FV12 following the CBT Guide to know the right conditions to activate to each tax code and what are the settings to each of them.
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While posting the customer or vendor invoices directly in SAP, tax codes will be entered. Tax codes should be available for selection and based on that, tax rates should be derived and calculate the taxes. Here no condition based tax rates, code will be derived. Just curious to know if this will work with the CBT with procedure TAXBRA. Can you please advise.
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It will not. the CBT is condition based technique e most of the tax data comes from source documents (PO and Sales Order). I would not recommend TAXBRA in this case.
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Hi Leandro,
Do you know if there is a S_ALR transaction for maintenance of PIS (J_1BTXPIS) and COFINS (J_1BTXCOFINS)? I searched but could only find it for IPI and NCM.
Thanks,
Michele
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It does….
> Maintain PIS Values tcode: S_P6D_40000013
> Maintain COFINS Values tcode: S_P6D_40000014
Sorry for the delay, I was in a personal vacation and took me sometime to catch-up on emails and blog comments.
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Hi Leandro,
We need to derive the PIS/COFINS tax rate in the SD order/contract based on the official service type field (J_1BSERVASSIGN2V-SERVTYPE_OUT) assigned to the material. However this field is not there in the dynamic key field in the tax group setting to select from. So i cannot maintain tax rates based on the service type. Do you think we can add a new field in the domain for dynamic key field? What are my options?
Thank you
Prakash
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Prakash, You can’t add new field values to the Tax Group Exceptions. Since you have a Material Number, can’t you use MATNR?
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Thanks Leandro for the recommendation. A follow up on that – If we use MATNR, we will have to update 10000 records for PIS and COFINS tax rates for about 5000 relevant MATNRs. Is there a mass transaction to update tax entry? SM30 is not allowed and somewhere I read LSMW does not work? Any suggestion?
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You can mass upload the data and then run the Migration of Condition Records to tax Tables on J1BTAX to the PIS and COFINS tables/Tax Group.
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Boa tarde Leandro.
Quando efetuo a MIRO e seleciono NOTA FISCAL, os valores estão corretos, mas não há um esquema de calculo. Saberia me informar onde consigo?
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Gustavo, não tem esquema de calculo na MIRO. Os valores vêm do pedido de compra e é lá onde está o esquema de calculo. O que voce esta tentando fazer?
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Boa tarde Leandro esto com dificuldades de indentificar quais condições devo ativar via FV11 VK11 no guia do CBTBrazil_Condition_Based_Tax_Calculation_V1.9 fornecido na nota e Docu_CBT_302
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Oi Daniel…. para a TAXBRA/RVABRA funcionar… se eu nao deixei passar nenhuma, voce precisa ativar via VK11 as condicoes: ICZF, IBRX, ICMO, ICSO, IPBS, IPIC, IPIO e pela FV11 BIC0, BI00 BIC1, BIC6, BCI1, BXWT e BXWA… Tirando as condicoes de impostos que voce pode tivar via F1 ou direto na tela do imposto via J1BTAX se a tabela estiver abert ara manutencao pelos fags no imposto.
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valeu leandro obrigado
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Hi Leandro,
We have maintain the tax code I0 and it has tax condition type IPI0, ICM0 and IGEW in J1BTAX. The tac condition IGEW is assigned to Account Key “WTG” but this account key is not detectable in OBCN due to this reason it is not part of OBYZ. When we create a PO with I0 tax code we are getting the error message as “No posting rules exist for account key” and unable to s ave the PO.
Please suggest me how to fix this issue.
Regards,
Sada
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