Parameters in the Tax Account 

If withholding tax is to be paid/reported, you must create an account to which it can be posted. The posting is made to this account automatically.

There are two fields in account master records that are important for withholding tax specifications:

Tax category
As the withholding tax account is not tax-relevant, you cannot make an entry in this field.

Post automatically only
This field determines how the account is posted to; either automatically only or both automatically and manually.