Making Settings in Vendor Master Records
The customer carries out this step.
In this step, you determine whether one or more withholding tax types are to be permitted for a vendor.
With extended withholding tax, several withholding tax types can be used for each vendor. The withholding tax types permitted for a vendor are defined in the master record for that vendor. When a posting is entered for which withholding tax has to be calculated, the accounting clerk can enter data for all withholding tax types permitted for the vendor in question.
Your decision as to whether one or more withholding tax types are to be permitted per vendor should be based on the following considerations:
One Withholding Tax Type per Master Record Possible
Choose this option if you are sure you want to use just one withholding tax type for each vendor. Each different vendor can use a different withholding tax type.
When new documents are posted after the withholding tax changeover has taken place, withholding tax can only be posted for the withholding tax types that have been entered in the master record of the relevant vendor.
This option prevents the accounting clerks from making mistakes when entering data, since it is not possible to enter withholding tax types that are not permitted.
The data is converted according to the rules you defined in the Type/code assignment step. When converting the documents, the system does not check whether the newly generated data only contains the withholding tax type that is permitted for each vendor.
After the changeover, further processing (payment, for example) of documents entered before the changeover is only possible if the withholding tax types defined before the changeover have also been entered in the master record of the relevant vendor).
You may have to process individual documents manually if a withholding tax code for classic withholding tax that is no longer permitted for the vendor in question has been used mistakenly. If this is the case, a non-allowed withholding tax type for extended withholding tax has been assigned to the withholding tax code for classic withholding tax.
Several Withholding Tax Types per Master Record Possible
Select this option
since for technical reasons, it takes up much more memory space in your database.
Choose, and select the required setting .