I have a customer who requires that the withholding tax is calculated on a “per line” basis, this is because the suppplier may supply both goods and services, the goods not being subject to withholding tax but the services are.
Is this possible to do in AX2012 ? I know that withholding tax is normally calculated at the time of the payment, and the invoice has already been posted by that time.
Hope domeone can help, thanks in advance.
Hi Thorin,
I am not sure about UK laws but withholding tax are calculated on event of PO invoice or vendor payment whichever is made first.
Withholding tax calculation is dependent on withholding tax group which you select on vendor. So if you are making payment to vendor and vendor had supplied both goods and services then withholding tax will be calculated on complete payment amount. In this case, you need to post separate payment for goods and services to calculate withholding accurately.
Pranav…
Thanks for the reply Pranav, but have just found the answer to my question.
By setting up the service item with a withholding “item tax code” and leaving the goods item without any withholding tax settings, I then process the PO as per normal (including posting the invoice). When I post the payment, the withholding tax is only calculated against the service line, leaving the goods line without the calculation. This does what I need.
Thanks for looking into this for me.