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FKKID_WHTSP_V - Define Threshold for Withholding Tax Calculation

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In this step, you can define a threshold of the tax base amount for a combination of a withholding tax code and withholding supplement tax code and assign a validity period by entering a start and end date to it.

The system accumulates the tax base amounts for the withholding tax calculation for a given fiscal period for each business partner or a group of business partners that belong to the same legal entity, and calculates and posts withholding only if the total base amount exceeds the threshold. If the total base amount in a period is lower than the threshold, the system posts a zero withholding tax amount.

The system processes as follows:

• You create an FI-CA document. The system checks if the document amount exceeds the threshold or not. If not, the system automatically calculates the withholding tax but also creates a negative correction entry as a correction tax supplement for it, so that the total amount of the tax is zero. During posting the document, both the document amount and the tax amount are stored in a database table and are considered when a new FI-CA document is posted.

• As soon as you create another FI-CA document for the same fiscal period and business partner, the system adds its document amount to the previous document amount and checks if the accumulated document amount exceeds the threshold. If yes, the system calculates the withholding tax for the second document, adds it to the withholding tax of the previous document and deducts the accumulated tax amount from the second document amount.

In this case, a catch-up is created for the second document. It means that the tax amount of the first document is withheld in the second document.

Note:

The threshold of the tax base amount must be defined in local currency. No foreign currency can be applied for the calculation. Example: If you enter threshold for the withholding tax calculation for India, enter INR as the local currency.

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Length: 2293 Date: 20240523 Time: 201614     sap01-206 ( 57 ms )