| # Example of aggregate tax code This functionality is specific for India. Example The following example shows the taxes levied in a purchase scenario. The value of an excisable item is INR 70,000. The applicable taxes are as follows: Basic Excise Duty (BED) is 16% on Order line price. Education cess (Ecess) on BED is 2%. Secondary and Higher Education cess (SHEcess) on BED is 1%. Central sales tax (CST) on Order line price + BED + Ecess+SHEcess is 4%. The above tax structure is represented in the Aggregate Taxes (tctax9141m00l) session as follows: In the first layer, enter the following values: Set the Type field to Amount. In the Percentage field, enter 100. Set the Amount Origin field to Order Line Price. When the approved aggregate tax is linked to the transaction with order line price INR 70000, the layer 1 represents INR 70000. In the second layer, enter the following values: Set the Type field to Tax. In the Tax Code field, select the tax code representing the 16 per cent tax from the Tax Codes by Country (tcmcs0536m000) session. Select the Layer 1 check box. Tax is calculated as 16 % of 70000 = INR 11200. In the next layer, enter the following values: In the Tax Code field, select the tax code representing the 2 per cent tax from the Tax Codes by Country (tcmcs0536m000) session. Select the Layer 2 check box. LN calculates the tax as 2 % of 11200 = INR 224. In the next layer, enter the following values: In the Tax Code field, select the tax code representing the 1 per cent tax from the Tax Codes by Country (tcmcs0536m000) session. Select the Layer 2 check box. LN calculates the tax as 1 % of 11200 = INR 112. In the next layer, enter the following values: In the Tax Code field, select the tax code representing the 4 per cent tax from the Tax Codes by Country (tcmcs0536m000) session. Select the Layer 1, Layer 2, Layer 3 and Layer 3 check boxes. LN calculates the tax as 4 % of (70000 + 11200 + 224 + 112) = INR 3261.44. The total tax applicable on the transaction is 11200 + 224 + 112 + 3261.44 = INR 14797.44 Note The Aggregate Taxes (tctax9141m00l) session displays the tax structure applicable for a transaction. The actual tax amounts are displayed in the Tax Breakdown Structure (tctax9141m10l) session, when the aggregate tax code is linked to a transaction. Related topics To use layers in aggregate tax To set up an aggregate tax code Example: Excise duty Example: Imports |