TAX computation

Hi everyone,

Does anyone know how to set up the this kind of tax code in AX:

Net amount in PO (Unit price x Qty) 1000

Input Tax (Net Amt x 12%) 120

Witholding Tax (Net Amt x 2%) 20

Total Payables

(Net amt+Input Tax-Witholding Tax) 1100

Thanks for those who would help!


Is this possible in AX?

Hi In Ax the effect would be the same but happens at 2 different points .

Step 1 When u invoice the respective tax gets calculated and payable shows as 1120.

step 2 when make payment withholding tax gets deducted and net payable is 1100 only .

In one my implementation where client insisted that invoice should show net payable wee have customized the invoice to show this .

Total invoice amount 1120

less WH tax 20

Net payable 1100

Hope this helps


I actually set up both the withholding and VAT in Sales Tax Code and attached it both to Sales Tax Group (with witholding as negative value). However, when I check out the Ledger account that I attached in the Ledger Posting group, it is still empty. with no transactions even if I posted the P.O. as invoice already.



The VAT and witholding tax were already calculated as i want it. However, the ledger account transaction for the sales tax is still empty and from the PO invoice form, there is already posted tax. Did I miss any set up?

I know now, in my GL parameter> Sales Tax Tab APPLY U.S. SALES TAX AND SALES TAX RULES should be unmarked so that in my Ledger posting group, the sales tax receivable would be visible.

Haha! Gotcha!

Hi Heylin,

I have a query regarding the set up of recognition of withholding tax in time of setting up payable/liability. I used the the negative sales tax percentage and put the ledger account in Sales Tax Receivable in Ledger posting group (the same thing that you did in your setup). The problem is, I encounter an infolog message which is “Account 26004 must have posting Sales tax”. Do you have an idea to resolve this issue?



Hi Ramil,

Go to the ledger 26004, in the setup tab, select Posting type as Sales tax.

Your problem will be solved.


Hi Pranav,

Dhanyavad =) It’s working!!!