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Withholding at Invoice Time
Withholding at Invoice Time
Vendor withholding is performed during invoice entry, invoice maintenance, or recording manual payment for a specific company/location when the Withholding Point flag on Reference File category 201 is set to 1. The following example illustrates how withholding is performed at invoice time through the Invoice, DR/CR Memo Entry conversation.
Note: Although the example uses the invoice entry conversation, withholding processing is the same in both the maintenance and recording manual payment conversations.
When you enter the information on the detail screen, you can specify one extra line for the vendor withholding amount. The withholding amount is calculated when you move to the recap screen. The figure below shows a sample detail screen with three lines, one for the amount of the invoice, one for the VAT tax, and one for the withholding amount.
WILLIAMS ACCOUNTS PAYABLE USD 2/11/93
DSP01 INVOICE DR/CR MEMO ENTRY DETAIL
Vendor BCA00001 Header Detail
BCA MANUFACTURING Gross 5,040.00 5,040.00
Paying Co/Loc 001 BRU Disc .00 .00
Orig Co/Loc 001 BRU Lines 3 3
Document IN INV000000152 Qty .000 .000
Date 02 11 93 VAT Amt 540.00 540.00
Account Center Dist Debit Amt Quantity Item Number UM D
Account Desc PO Num Co/Loc VT Ref1 Ref2 Desc
2120 C1 5,000.00 N
A/P HOME VENDORS 001 BRU R1
N
001 BRU R1
N
001 BRU R1
N
001 BRU R1 +
F7=Header F11=Recap F13=Cancel Trans
F22=End Tran F24=More Keys
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Invoice Entry Detail Screen for Vendor Tax Withholding
When you move to the recap screen (by pressing F11), a command key is available to allow you to display a window containing the withholding information for this vendor's invoice. The figure below shows a sample of the this window when called from the recap screen.
WILLIAMS ACCOUNTS PAYABLE USD 2/11/93
DSP01 INVOICE DR/CR MEMO ENTRY RECAP
Vendor BCA00001 BCA MANUFACTURING
Paying Co/Loc 001 BRU Orig Co/Loc 001 BRU
Document IN INV000000152 Document Date 02 11 93 Batch
Header Detail Difference
Gross 5,040.00 5,040.00 .00
Disc .00 .00 .00
Lines 3 3 0
Quantity .000 .000 .000
VAT Amt 540.00 540.00 .00
WITHHOLDING INFORMATION
Withholding Code 10
Withholding Rate .10000
Subject to Withholding Amount 5,000.00
Withholding Amount 500.00 +
ENTER=Return to Recap F3=Exit
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Withholding Information Window from Invoice Entry Recap Screen
The Withholding Information Window displays the withholding code associated with the vendor on the Vendor Master File, the withholding rate associated with the code, the subject to withholding amount, and the withholding amount.
The subject to withholding amount is set equal to the taxable amount of the invoice, and the withholding amount is calculated based on the subject to withholding amount and the withholding rate as follows:
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Withholding Amount
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=
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Subject To Withholding Amount
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*
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Withholding Rate
(expressed as a percentage)
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When this window is displayed, you may change the withholding code and/or the subject to withholding amount. If you change either of these values, the withholding rate and withholding amount are updated accordingly.
Once you are satisfied with the withholding information, you can close the window and finish entering the transaction. Note that although the withholding amount is not shown on any of the screens, the detail and header screens will specify one extra line for it. The account/center for the withholding amount is retrieved from Reference File category 202, Account Number Assignment.
If you inquire on this transaction through the Accounts Payable Inquiry conversation, the withholding amount will be shown as a negative line item on the distribution screen as shown below (the line is highlighted).
WILLIAMS ACCOUNTS PAYABLE USD 2/11/93
DSP01 ACCOUNTS PAYABLE INQUIRY DIST
Vendor BCA00001 BCA MANUFACTURING Header
Paying Co/Loc 001 BRU Orig Co/Loc 001 BRU Gross 5,040.00
Document IN INV000000152 Batch Disc .00
Document Date 02/11/93 Acct Date 02/11/93 Lines 3
Document Cur USD Qty .000
Status OPEN VAT 540.00
S Co Loc Account Center Dist Amount PO Num Distribution Desc M
Ref1 Ref2 VAT Quantity UM Part Number D
001 BRU 2120 C1 5,000.00 A/P HOME VENDORS N
001 BRU 2170 500.00- VENDOR WITHOLDING N
001 BRU 1240 C1 540.00 VAT DECLARABLE N
F2=Command F3=Exit F5=Vendor Activity F6=Fold/Trunc
F7=Display Header F10=Selection F19=Base Currency
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Accounts Payable Inquiry - Distribution Screen with Vendor Withholding Line
As shown above, the withholding amount for the invoice was credited to account 2170. The account was retrieved from Reference File category 202.
When this invoice is selected for payment, the amount paid is the amount of the invoice which already reflects the withholding amount. Whether withholding is performed at invoice or payment time, the same withholding account is booked for the withholding amount.