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 Defining Accounts for Withholding Tax 

Use

You define accounts for the account determination for posting withholding tax.

Procedure

In the Implementation Guide for Financial Accounting, choose Financial Accounting Global Settings

® Withholding Tax ® Extended Withholding Tax ® Postings ® Accounts for Withholding Tax .

Depending on whether you have set the posting indicator in the withholding tax code or if you use self-withholding, define accounts for the following transactions:

  • Define accounts for withholding tax to be paid over

Here you define accounts for the normal withholding tax transaction (WIT). This transaction is required for every withholding tax posting.

  • Define accounts for withholding tax for "Grossing Up" offsetting entry

You define accounts here if you have selected value

2 for the posting indicator in the withholding tax code. An offsetting posting with the opposite +/- sign is then carried out for the withholding tax item (transaction GRU). The withholding tax amount is increased by a factor of 1/(1-p).
  • Define accounts for withholding tax offsetting entry

You define accounts here if you have selected value

3 for the posting indicator in the withholding tax code. An offsetting posting with the opposite +/- sign is then carried out for the withholding tax item (transaction OFF).
  • Define accounts for self-withholding tax

You define accounts here if you want to post self-withholding tax. An offsetting posting with the opposite +/- sign is then carried out for the withholding tax item (transaction OPO).