Understanding Payee Information for City Codes

ISS is a tax that is applied based on the city in which a service occurred. When you pay a supplier for provided services, you must withhold the ISS tax amount and pay it to the city. You use the Taxes Setup by City Code program (P76B406) to set up the payee information and associate the payee information to the city code. You also specify whether the service code for purchase transactions (purchase fiscal code) and sales transactions (sales fiscal code) are the same.

Note: If you enter 1 in the Single Svc Fiscal Code field, the values that you set up for the purchase and sales fiscal codes in the Service Fiscal Code program (P76B405) must be the same.

The system saves the information that you enter to the Taxes Setup by City Code table (F76B406) and uses the information to validate the payment terms and payee when you run the Tax Calculation ISS, INSS, FUNRURAL program to calculate ISS withholding.