Impact of GST on the Purchase Order process

If GST is implemented:

  1. You must specify the tax code and registration numbers in the Purchase Order (tdpur4100m900) session, based on the master data set-up.
  2. Infor LN defaults the data specified in the Purchase Order Lines (tdpur4101m000) session, such as Registration Number Sequence (BP), Registration Number Sequence (Own), and ASV Origin for GST, on the corresponding Incoming Goods Pass Out Document (GPD), when the goods are received. Note: In the GPD lines session, you can view the break up of the taxes levied on the goods, based on the tax related data specified on the receipt line. You can modify the tax data until the GPD is approved.
  3. The tax data is defaulted on the invoice.
Note

After the goods are invoiced or the supplier pays the taxes, the purchasing organization can claim the input tax credit.

The purchase processes/scenarios for which GST is applicable:

Intra State Purchases

Intra State Purchases is the process wherein goods or services are shipped or delivered and received in the same state. The taxes, CGST and SGST, are applicable on the supply of goods or services. The taxes are levied on the order line amount or the assessable value.

Inter State Purchases

Inter State Purchases is the process wherein, goods or services are shipped from one state and are received or delivered in another state. The tax, IGST of the destination state, is applicable on the goods. The tax is levied on the order line amount or the assessable value.

Direct Delivery Purchase Orders

Direct Delivery Purchase Orders is the process wherein, the goods are not shipped to a organization or a warehouse. The goods are delivered directly or shipped to the project site, service location, or are High Sea purchases. You can claim input credit for all the transactions, if the ship-to business partner/organization is registered in the receiving state. The relevant interstate or intrastate GST is applicable.

Purchase Returns

Purchase Returns is the process wherein the goods are returned to the supplier if the goods are in excess or do not pass the quality inspection. GST is calculated on the receipt amount. Else, you can re-calculate GST on the transaction value. If the goods are returned within six months of receipt, the tax specified on the order line is considered. Else, the tax is recalculated.

Free of Cost Purchases

For goods that are obtained free of cost, such as samples and material supplied free of cost, GST is calculated based on the Assessable Value or the market value.

Purchase Orders with Landed Costs

For purchase orders with landed costs (example, freight and insurance charges), the taxes are levied on the landed costs and the purchase costs based on the GST tax code specified on the order line.

Import Purchase Orders

For imports, Special Additional Duty and Counter availing duties are replaced with IGST.

Basic Customs Duty (BCD) and Inter State GST (IGST) is levied on imported goods.

Example

For a purchase order:

If the Assessable Value is 100 INR

The BCD at 10% is 10 INR,

IGST at 20 % is calculated as follows:

20% of (100 + 10)= 22	INR
Note

IGST is refundable. Note IGST is available for claiming input tax credit. If excess credit is incurred due to inverted duty structure, you can apply for refund.

Subcontracting Purchases

For a subcontracting purchase order, GST is levied on the amount specified by the supplier.

Tax Inclusive Purchases

For Tax Inclusive Purchases, the purchase value includes tax. You must derive the tax from the tax inclusive transaction value. The entire purchase order line must be tax inclusive or tax are calculated in addition to the order line price.

Note
  • The dealer warehouse concept is not applicable, as GST is levied on every purchase and sales transaction.
  • For items that are excisable, such as petroleum products, the excise duty is applicable. You cannot claim the input tax excise duty.
  • Purchases from SEZs / EOUs are considered as import transactions.

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