Withholding Tax setup in oracle apps r12

Withholding Tax setup in oracle apps r12

In this post, we will be discussing about Withholding Tax setup in oracle apps r12. Withholding tax is the amount deducted from the Supplier / contractor Payment while making payment again their bills in Oracle application. To Calculate the withholding tax, we need to do the withholding tax setup in oracle apps r12. Then later, withholding tax Deducted amount added to the Tax Authority in oracle apps and then later pays to Government as Tax collected from source. I will try to share step by step withholding tax setup in oracle apps r12 in this post.

You may be required to withhold taxes from your employee expense reports and supplier invoices. Once you set up Payables to automatically withhold tax, you can withhold tax either during Approval or during payment processing. You can control all withholding tax options in the Withholding Tax region of the Payables Options window.

What is Withholding Tax ?

Withholding tax is the amount deducted from the Supplier / contractor Payment while making payment again their bills in Oracle application.Then later, withholding tax Deducted amount added to the Tax Authority in oracle apps and then later pays to Government as Tax collected from source

Detail Step by Step for the Withholding Tax setup in oracle apps r12

Step1:- Payables è Setup è Options è Payables Options

 

Step2:- Create Withholding Supplier to Deduct the Withholding tax amount.

Supplier Type Should be ‘Tax Authority’

 

 

Under Tax Details :-

Click on Allow Withholding Tax Check Box

 

 

 

Setup è Calendar è Special Calendar

If you want to Automate WTH tax for supplier invoice , then you need to create Special calendar with type 'Withholding Tax'

 

Setup è Tax è Withholding è Codes

Create Withholding tax codes and attach the Tax authority Supplier created in step2 in this tax codes and attach the site too.

 

Create the Tax WTH tax group and attach the WTH tax code in this group.

If you want to attach/apply multiple taxes to invoice , then we can create WTH tax group and then attach the tax codes to this Tax group.

In invoices we can apply the tax group and tax codes both , if we will apply tax group , then automatically all the taxes under that tax groups will attach to these invoices.

 

Working of Withholding Tax setup in Oracle apps r12

Step 7:- Create AP invoice in Oracle Payables and then Attach the WTH tax group to the invoice in the Invoice Headers.

Before applying WTH tax to invoices first you need to enable the withholding tax to that supplier in the supplier master for which you want to apply WTH tax to these Invoices.

 

 

Once we will validate the AP invoice then automatically WTH tax will be apply to the invoice in the Invoice Lines as below.

 

 

Withholding Tax setup in oracle apps r12