I have a problem in calculating the Withholding as my Axapta version includes only Sales tax. how to record the withholding tax on Vendor Payments? For example: For local government rule, whenever you paid to individual, depending on if this person is foreigner or local contractor, the company is responsible to withhold a certain % of the payment for the Vendor. If the withholding is 10%, the payment is for $100. I should only pay the vendor $90, and record $10 as withholding tax payable. And the $10 will be accumulated, reported, and paid to the government on a monthly basis. the entry should be like that:- VendorNo.3001 Cr.$100 VendorNo.3001 Dr.$10 WithHolding Tax Cr.$10 Expense Account Dr.$100
Hi Manal, It may be best to consider doing this when you post the invoice, not when you make the payment. You can configure the ‘sales tax’ to make negative adjustments on the invoice (i.e. deduct tax, not add it on). So at time of invoice posting you get: Vendor 3001 Cr. $90 Withholding tax Cr. $10 Expense Db. $100 (you may also be able to configure so the vendor is Cr. 100 and Db 10 - I’m not sure) Then the payment is straight forward.