Understanding Payment of CIS Vouchers

To process withholding amounts for subcontractors, you must first determine whether withholding tax applies to your subcontractor's vouchers.

After the system evaluates vouchers for withholding tax eligibility, the system calculates the actual withholding tax amounts for each voucher.

The purpose of CIS is to calculate any withholding tax liability at the point of payment, not at the point of voucher entry. Therefore, you must run the CIS Update Payment Validation program and the CIS Calculate Withholding program (R74U04580) as part of the payment cycle.

After you process the withholding amounts for your subcontractor, you can run the create payment groups process to generate payments as usual.