Withholding Tax on Down Payment

[Former Member]

I have set a minimum amount for the tax code as Rs.10,000 and the formula is set as upto Rs. 10,000 nil & above Rs.10,000 @ 10%. I have created 2 WHT types - for payment & invoice. While entering down payment on say an amount of Rs. 4000, TDS is not deducted which is correct. However no WHT is deducted on subsequent down payment of Rs.7000. Tax should have been deducted on the entire amount of Rs.11000. I have set the Tax Type as with accumulation starting from period 4. Why is tax not being correctly deducted at the time of down payment?

[Former Member]

Hi

Please do check full configurations as per attached link

http://www.sapficoconsultant.com/Bonus/Extended%20Withholding%20tax%20configuration.pdf

Hope it willl solve your problem

Regards

Praveen PC

[Former Member]

yes i have

[Former Member]

HI,

Check whether you have assigned the amount of Rs 10000 in minimum base amount fields for the relevant tax type.

Saubag

[Former Member]

It is already set at optional.

[Former Member]

Hi

Please check wheather your the field status Group of Down payment made in optional or surpress mode if it is on surpress mode ,change it into optional mode

For making changes please use the below mentioned path

Transaction Code :OBC4

SPRO>Financial Accounting>Financial Accounting Global Settings>Document>Line Item>Controls>Define Field Status Variants>

Select your companies Field Status variant & Double click on Field Status Group (Select Accounts for down payment Made) Double click on it Select Taxes change them into optional entries(Radio Button)

Regards

Praveen P C

[Former Member]

I have already done this.however while paying 2nd advance of Rs. 7000, TDS is not deducted on entire amount of 11000(4000+7000)

[Former Member]

Hi

Please follow the below mentioned configuration step , hope that will solve your mentioned senario

SPRO>Financial Accounting>Financial Accounting Global Settings>Withholding Tax>Extended Withholding Tax>Calculation>Minimum and Maximum Amounts>Define Min/Max Amounts for Withholding Tax Types(Minimum withholding tax base amount:Mention Rs.10000/- )

Minimum withholding tax base amount (during posting)

Minimum withholding tax base amount. If the base amount calculated when the invoice is posted is lower than this minimum, the system does not calculate any withholding tax, and no withholding tax is posted.

Note

If the base amount exceeds this minimum amount, the system uses the whole base amount to calculated the tax. The minimum withholding tax base amount is therefore not synonymous with the withholding tax exemption amount.

SPRO>Financial Accounting>Financial Accounting Global Settings>Withholding Tax>Extended Withholding Tax>Calculation>Minimum and Maximum Amounts>Define Min/Max Amounts for Withholding Tax Codes(Minimum withholding tax base amount (during posting) Rs.10000/-

Minimum withholding tax base amount. If the base amount calculated when the invoice is posted is lower than this minimum, the system does not calculate any withholding tax, and no withholding tax is posted.

Note

If the base amount exceeds this minimum amount, the system uses the whole base amount to calculated the tax. The minimum withholding tax base amount is therefore not synonymous with the withholding tax exemption amount.

After making the required changes please check your scenario

Hope it will solve your problem

Regards

Praveen PC

Edited by: Praveen Chirakkel on Apr 25, 2011 9:17 AM