1. Localizations for the United Kingdom and Ireland Implementation Guide
  2. Options for Paying Withholding Tax to the Revenue Authorities

Options for Paying Withholding Tax to the Revenue Authorities

You can pay withholding tax that you have deducted from subcontractors' payments using either of the following methods:

  • Accounts Payable

  • General Accounting

Processing withholding tax payments through the JD Edwards EnterpriseOne Accounts Payable system normally means that you pay your withholding tax as a separate payment to the Inland Revenue Service. The withholding tax payment is not included with your monthly PAYE (Pay As You Earn) payment.

To process withholding tax payments through the JD Edwards EnterpriseOne Accounts Payable system:

  1. Accumulate withholdings (tax deductions) for your subcontractors under the tax authority payee (Inland Revenue Service) with a pay status of H (hold).

  2. Release your pay items using the Speed Release program (P0411S) when you are ready to make a payment run.

  3. Run the Create Payment Control Groups (R04570) program with the Payee processing option on the Process By tab set to 1 to create payment groups by payee.

  4. Write and update a payment using a UK cheque (P04572U1 or P04572U2), a BACS payment (P04572B), or another payment print program to create your payment to the Inland Revenue Service.

  5. Send this payment to the Inland Revenue Service.

Processing withholding tax payments through the JD Edwards EnterpriseOne General Accounting system enables you to include your withholding tax in your monthly PAYE payment to the Inland Revenue Service. This method is a common practice in the United Kingdom.

To process withholding tax payments through the JD Edwards EnterpriseOne General Accounting system:

  1. Accumulate withholdings (tax deductions) for your subcontractors under the tax authority payee (Inland Revenue Service) with a pay status of H (hold) and an alternative bank account, such as a withholding tax account.

  2. Release your pay items using the Speed Release program (P0411S) and change your bank account to a withholding tax account when you are ready to make a payment run, if you have not already done so.

  3. Run the Create Payment Control Groups program (R04570) and select your withholding tax account as the bank account and the Inland Revenue Service as a special payee.

  4. Use the Work With Payment Groups program (P04571) to write and update the withholdings payment, but do not print or send the AP payment.

  5. Process your normal Inland Revenue Service payment through the general ledger by creating a journal entry to debit your tax withholdings account and your PAYE account and crediting your normal bank account with the sum of all payments to the Inland Revenue Service.

  6. Create a physical payment to the Inland Revenue Service outside of the system, such as by writing a cheque manually.

  7. Send this payment to the Inland Revenue Service.