Create TCD Code – A summary of the activity

This activity enables you to add taxes and charges and deduct discounts from the accounts payable to a vendor. These Taxes, Charges and Discounts (TCD) depend on the terms and conditions, of the contract between the supplier and the customer based on the Government policies. Taxes such as Sales tax and Central Excise tax, which are added to the amount of an item, are mostly calculated as a percentage. Charges such as surcharges and documentation charges, which are also added to the amount of an item, are mostly calculated as flat charges on an item. Discount, which is a sale on a discount, reduces the amount of an item, calculated either as percentage or as flat amount.

You can define a unique code and variants for a TCD. TCDs with similar characteristics, applicability, criteria and types are grouped together as a single code. The type of the TCD could be percentage, flat or unit rate. A TCD code can be mapped to other relevant TCD codes.

TCD variants indicate the individual characteristics of TCD codes, which may vary as per geographies, suppliers, etc. For example, you can define TCD code as ‘Excise duty’ and variants as ‘Excise duty of USA’ or ‘Excise duty of Europe’. You can define multiple variants for a TCD code. The variant details can be defined for each organization unit.

TCD codes can be classified as “independent” or “dependent” codes. TCD codes that are not applicable on any other code are termed as “independent” TCD codes. TCD codes that are applicable on other codes are “dependant” TCD codes.  

Getting familiar with the pages inside

What you can do in this activity

Define a TCD code at Company level

Map the TCD to other TCD codes

Set attributes for statutory  taxes

Define a TCD code at Company level

You can create TCD codes that are unique within a company. The TCD code is independent of currency.

• Go to “Create TCD Codes” page.

• Enter the TCD Details.

On clicking the “Create TCD Code” pushbutton, the TCD code is created for the company to which you have logged in.

Map the TCD to other TCD codes

TCD code mapping enables you to define a sequence of TCD codes on which the current TCD is applicable. The TCD value will be calculated according to the sequence in which the TCDs are mapped. For example, since surcharge is usually applicable on total taxes, you can map the TCD code ‘Surcharge’ to the TCD code ‘Total taxes’ for surcharge calculation.

Only one-way mapping is allowed. For example, if Tax T1 is mapped to Tax T2, then mapping of T2 to T1 is not allowed. TCDs with “Flat” and “Unit Rate” basis cannot be mapped to other TCD codes. You can map a TCD code only if the computation basis is percentage, applicable on the “Basic Value”.

•  Go to “Map TCD Codes” page to map a TCD code to other TCD codes.

Set attributes for statutory taxes

• Specify attributes for a statutory tax, such as VAT, in the Specify Tax Attributes page.

• Select the “Save Attributes” pushbutton.