Discounts and Write-Offs
Discounts (AP and AR) and Write-offs (AR) proportionally decrease the amount of the suspense VAT during the post of the receipt or payment.
To calculate discounts and write-offs correctly, you must complete this setup:
Select these options in the Tax Rules program (P0022) for both the JD Edwards EnterpriseOne Accounts Payable and JD Edwards EnterpriseOne Accounts Receivable systems:
Tax on Gross including Discount.
Discount on Gross Including Tax.
Set the processing options on the Taxes tab for the General Ledger Post Report program (R09801) as:
Update Tax File = 3 (for all Tax Explanation Codes).
Adjust V.A.T. Account for Discount Taken = 2 (Update VAT, Ext. Price and Taxable).
Adjust V.A.T. Account for Receipt Adjustments and Write Offs = 2 (Update VAT, Ext. Price and Taxable).