Creating Withholding Tax Invoices
After you apply withholding tax to an invoice, you can optionally create invoices to remit withheld tax to the tax authority.
Prerequisite
If you are paying the tax authority with an electronic payment, assign a primary bank account to the tax authority's supplier site record. Payables will use this bank account for payment. See: Defining Supplier Bank Accounts.
To create withholding tax invoices:
Payables can automatically create withholding tax invoices, or you can perform this task manually. If you choose to automatically create withholding tax invoices, you must choose whether to do this during Approval or during payment processing. Indicate this choice in the Withholding Tax region of the Payables Options window. See: Withholding Tax Payables Options.
If you choose to create withholding tax invoices manually, create an invoice for each Withholding Tax type invoice distribution on an invoice. Create the invoice for the tax authority supplier and site assigned to the Withholding Tax type tax name and for the amount of the Withholding Tax type invoice distribution. See: Entering Basic Invoices.
If you specify that you want to create withholding tax invoices during Approval, Payables creates unapproved withholding tax invoices for tax authority suppliers assigned to tax names. If you specify that you want to create withholding tax invoices during payment processing, Payables creates unapproved withholding tax invoices (for those invoices where you have applied withholding tax) during the Confirm program of payment batch processing, or during processing of a Quick payment.
Attention: Payables does not automatically withhold taxes if you pay with a manual payment.
Paying a Tax Authority
Prerequisite
To pay a tax authority:
- Create a payment batch and enter the unique Pay Group for the tax authority. Choose a payment document that uses a Payment Format with a Tax Authority Remittance Advice. The Tax Authority Remittance Advice lists original invoices on which tax was withheld, and the withheld tax amounts. See: Paying Invoices in Payment Batches.