IFCA Lease365: Treatment for existing contracts due to 8% SST
Following to the recent announcement on the expansion of the service tax scope, Tax code for 8% SST has been created in Lease365 (SeT8).
Next,
- User need identify which bill item is subjected to 8% SST.
- Kindly list out the detail of bill item with 8% SST.
- Please submit the request to group system controller (GSC).
Below is the scenario for updating existing contract after create the 8% SST bill item for rental (ONLY IF THIS IS APPLICABLE TO YOUR BU)
Scenario 1:
If currently using Bill Item already charging 6% tax, upcoming 8% only have to change in Tax Setup, no changes required on Rental side. Will not affect previously billed transaction.
Scenario 2:
If currently using NA-O Tax Code Bill Item, need to change to SST a new tax code with a tax rate of 8% for the same bill item, when post unbill from Billing Schedule, system will be able to pickup the latest tax code and tax rate. Will not affect previous billed transaction.
Scenario 3:
Replace with new Bill Item with new tax code, user will need to carry out addendum for affected contract.
Steps to create addendum:
- First get ready the new bill item (SeT8) to be used with the updated tax code first.
- Then you may proceed to perform the addendum.
If the last bill you have billed is for the month of June, when you performed the addendum you should put the addendum effective date to 1st of July. Then you reset your bill schedule from 1st July till end of the date, using the new updated Bill Item.
- By doing it this way, since effective date is 1st July, the addendum will not affect whatever invoices that you have posted till June 2025. And this will remove all the unbilled in schedule bill and replace with a new set of unbill using the new Bill Item