Calculation Point Options

On the Manage Tax Reporting and Withholding Tax Options page, define the calculation point to specify the time to apply withholding taxes to supplier invoices.

Calculation point is determined at:

• Invoice

• Payment

Invoice

Select Invoice for taxes to be automatically withheld at invoice validation. If you select this option, Oracle Fusion Tax calculates withholding only once. If you adjust an invoice after it was validated, you must adjust the withholding tax manually and enable the Allow manual withholding option.

Taxes can be withheld from standard invoices, including credit and debit memos, and prepayment invoices. If you select the calculation point of Invoice for the event class, Prepayment invoices, consider timing the entry of the prepayment application before the invoice is validated.

If you:

• Apply the prepayment before the invoice is validated, Oracle Fusion Tax creates a withholding tax net of the prepayment amount.

• Validate the invoice first, Oracle Fusion Tax creates a withholding tax based on the taxable invoice amount. When you apply the prepayment, the withholding tax on the invoice isn't updated. You can manually adjust the withholding tax amount and the withholding invoice.

  As an alternative, you can cancel all of the withholding taxes on the validated invoice before you apply the prepayment. Once you apply the prepayment, withholding taxes are created net of the prepayment amount.

Payment

Select Payment for taxes to be automatically withheld when you create payments in a payment process request or with a Quick payment.