What is IEPS in SAP FI - Financial Accounting?

SAP Term: IEPS

• Component: FI

• Component Name: Financial Accounting

• Description: In Mexico, a special tax on production and services impuesto especial sobre producción y servicios. It is levied on certain goods such as alcoholic drinks, tobacco products, and fuels There are different rates of IEPS for different products. IEPS is calculated before VAT. When calculating VAT, the IEPS is included in the VAT base amount. &EXAMPLE& An alcoholic beverage costs MXN 100 per bottle net. IEPS at 20% takes the price up to MXN 120; 15% VAT is then added on the MXN 120, giving a final gross price of MXN 138.

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• Key Concepts: 
  IEPS stands for Impuesto Especial sobre Producción y Servicios, which is a value-added tax (VAT) in Mexico. It is a consumption tax imposed on goods and services at each stage of production and distribution. The rate of IEPS varies depending on the type of product or service being taxed. 
  
  How to use it: 
  In SAP FI Financial Accounting, IEPS is used to calculate the amount of taxes due on goods and services. The system will automatically calculate the amount of IEPS due based on the type of product or service being taxed. The system will also generate a report that shows the total amount of taxes due for each transaction. 
  
  Tips & Tricks: 
  It is important to ensure that the correct rate of IEPS is applied to each transaction in order to avoid any discrepancies in the amount of taxes due. Additionally, it is important to keep track of all transactions that are subject to IEPS in order to ensure that all taxes are paid in a timely manner. 
  
  Related Information: 
  For more information about IEPS, please refer to the Mexican government’s website: https://www.gob.mx/hacienda/documentos/ieps-impuesto-especial-sobre-produccion-y-servicios