Glossary for Indian localizationaggregate tax code A tax code that represents multiple individual tax codes. If
more than one tax code applies to a transaction, you can link an aggregate tax
code to the transaction. You can define tax codes upto 9 levels in an aggregate
tax code. ARE ARE form is a document, that must be enclosed with exports and
deemed exports. The document ensures that you must not pay excise duty on the
transactions. The two types of ARE documents are ARE-1 and ARE-3. assessable value The base amount on which the tax is calculated. bill of entry an account of goods entered at a customhouse, of imports and
exports, detailing the merchant, quantity of goods, their type, and place of
origin or destination. It is issued by the customs presenting the total
assigned value and the corresponding duty charged on the cargo. bond A bond is a surety or a security provided to the governing
authority, by a manufacturing plant, to remove the goods from its premises
without paying basic excise duty, on the condition that the goods are exported. capital item Machinery required for production of goods or for rendering
services, including those for replacement or expansion. The machinery can be
prime movers, instruments, apparatus and appliances, control gear and
transmission equipment and also any auxiliary equipment required for research,
testing and quality control. CENVATABLE The goods are called as CENVATABLE when the excise is
applicable for them and are used in Production of finished goods which are also
excisable. CENVAT credit pool The amount of excise duties accumulated with the receipt of
goods which can be set off against the excise duties payable against removal of
goods from a warehouse. Credit pool is maintained only for CENVATABLE
goods. consignee An individual or organization to whom the goods are
delivered. consignment note The document issued by the Goods Transport Agency (GTA) to the
consignor against the receipt of goods for transport by road. The consignment note contains the following information:
consignor An individual or organization who dispatches the
goods. Delivery challan A delivery challan is a document generated for the
transportation of the items and mandatory to carry along with the transported
goods. This document contains the details of the items shipped, quantity of the
goods, buyer and the delivery address. domestic tax Tax rates applied to transactions that for taxation purposes
are considered as transactions within a single state. ECC See: Excise Control Code End use a Customs procedure whereby goods entered for free circulation
may be given favorable tariff treatment at a reduced or zero rate of duty on
condition they are put to a prescribed use. This procedure is designed to
facilitate trade and ease of movement of goods. End Use Code is a list
circulated by government. event tax The tax levied when a pre-defined event happens. Example Manufacture of
excisable goods in India is a taxable event. The manufacturer must pay excise
duty on the manufactured item at the time of removal of the item from
warehouse. E-way bill E-Way Bill is an electronic waybill document generated on the
e-Way Bill Portal by the registered persons or transporters for the
transportation of the items when the value of the items exceeds fifty thousand
rupees. An E-way bill is identified by a unique E-way Bill Number (EBN) which
is allocated and available to the supplier, recipient, and the
transporter. excisable An item is excisable if it is movable, marketable and specified
in the Central Excise Tariff Act.
Excise Control Code The Excise Control Code (ECC) is a unique number given by the
excise authorities to the factory or warehouse or dealer dealing with excisable
goods. The number is in the following format:
Acronym: ECC excise invoice/Goods Pass out Document (GPD) The document sent by the supplier, along with the excisable
goods. It comprises of the list of goods and the amount of excise duty. CENVAT
credit is claimed against this document. excise range Excise range is the area in the jurisdiction of an excise
official, where the manufacturing unit or warehouse or dealer is
located. first stage dealer The dealer who purchases the goods directly from a manufacturer
or importer or from any premises where goods are sold on behalf of a
manufacturer or an importer . folio The serial number attached to the receipt of each excisable
item in a RG 23 D register. It is generally the page number in a manual
register. Goods Transport Agency An individual or commercial establishment that provides service
for transport of goods by road and issues a consignment note. Acronym: GTA group tax code A tax code that represents multiple individual tax codes. If
more than one tax code applies to a transaction, you can link a group tax code
to the transaction. Applicable only on the purchase transactions in LN. For example, a group tax code can contain tax codes for:
GST Cess a compensation cess levied under section 8 of The Goods and
Services Tax (Compensation to State) Act, 2017. GST cess is levied on
intra-state supply of goods or services and inter-state supply of goods or
services to provide compensation to the States for loss of revenue due to
implementation of GST. GSTIN a state-wise PAN-based 15-digit number assigned to each GST
payer. For example, GSTIN - 22 AAAAA0000A 1 Z 5. Note The 15-digit unique number stands for:
GSTR The Goods and Services Tax Return is a document that a taxpayer
is required to file as per the law with the tax administrative authorities.
Each individual registered under the GST Act has to periodically furnish the
details of sales and purchases along with tax collected and paid thereon,
respectively, by filing online returns. According to the GST law, a normal
taxpayer is required to furnish three returns monthly and one annual
return. GSTR-1 a detailed return prepared for the invoices raised by the
businesses for the buyers. The data is used by the customers to claim input tax
credit. GSTR-2 a monthly GST return that summarizes the details of inward
purchases of taxable goods and/or services. GTA HSN code HSN code is a unique eight digit customs classification code
given to an item; based on the internationally recognized Harmonized System of
Nomenclature (HSN). The code is defined as following for each
item:
Ineligible for ITC The buyer (dealer registered under GST) is not eligible to
claim input tax credit on the advance payment made to the supplier until the
receipt of goods or services. layer A line in the Aggregated Tax (tctax0140m000) session which maintains the details of an amount or a
tax code. Letter of Undertaking an agreement or contract between two parties that outlines
specific work activities being completed in a certain time frame. When goods
are exported (either out of India or to a special economic zone [SEZ]) without
paying export duty (IGST), the export is completed under a Bond (B1 or B17) or
exporters must furnish a Letter of Undertaking (LUT). By furnishing LUT,
exporters undertake to complete export of goods/services within a period of
three months from the date of issue of export invoice. lorry receipt a receipt issued by a transport company when goods are sent by
road. The receipt acts as an undertaking for a company to deliver the goods to
the point of destination. Maximum Retail Price (MRP) The maximum of the retail price; when multiple ‘retail sale
price’ is printed on the pack. Usually this is specific to
location. multiple tax code Multiple tax codes are applicable on both purchase and sales
transactions. For a transaction, the tax codes are used when the 'Kind of Tax'
is same for different tax percentages. Personal Ledger Account (PLA) The ledger account maintained by the manufacturer to pay
excise duty in cash. related party a person or an entity related to the reporting entity. This
person or entity can be a close member of the business partner’s family or
related to the reporting entity and has control, joint control, or significant
influence over the entity. Retail Sales Price (RSP) The maximum price at which the goods are sold to the consumer.
It includes all taxes, freight, transport charges, commissions, advertising
expenses and all other additional charges like delivery, packing, forwarding
charges etc. The retail sale price can be different for each state. This is
defined in the Item-Sales or Item-Purchase sessions. reverse charge If a supplier is an unregistered dealer, the recipient of the
goods and/or services is liable to pay GST instead of the supplier. This GST
amount paid by the recipient is considered as reverse charge. second stage dealer A dealer who purchases the goods from a first stage
dealer. sequence number A unique number used to identify each tax registration number
separately. tariff value The item value fixed by the Indian government for the
calculation of excise or customs duty. tax exemption Being exempt from tax. Transactions with specific business
partners, involving specific goods, and/or with their origin or destination in
certain countries or areas, can be exempt from tax. Sales invoices for
transactions that are exempt from tax must have zero tax amounts. Some enterprises are exempt from sales tax within the jurisdiction of certain tax authorities. Invoices for sales to a customer with a valid tax exemption must have zero tax amounts. If you are exempt from sales tax, your suppliers must not include the tax amount on their invoices. TDS Tax Deducted at Source (TDS) is a system introduced by Income
Tax Department, India, where the person responsible for making specified
payments such as salary, commission, professional fees, interest, rent, and so
on is liable to deduct a certain percentage of tax before making payment in
full to the receiver of the payment. TDS Return A TDS return is a quarterly statement which must be submitted to the income tax
department. The statement include details of TDS deducted and
deposited. tender Sealed bid or offer document containing detailed information
about the requirements and the terms associated with a potential
contract. third party business partner A invoice-from business partner by whom the additional costs
are incurred. The business partner who is not related to purchase order and you
receive a separate invoice from him. Example, an insurance
agent.
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