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SIMG_CFORFBT059M_C - Define Min/Max Amounts for Withholding Tax Codes

Define the minimum and maximum withholding tax amounts for each tax code.

The requirements for calculating withholding tax vary according to country/region. This configuration step simplifies your withholding tax calculation by enabling you to define minimum and maximum amounts for the withholding tax for each tax code. You can also define a minimum tax base amount below which no withholding tax is deducted. If a journal entry with this tax code is posted, the system calculates the withholding tax amount based on the minimum and maximum settings you have defined, the tax base amount, and the tax rate.

There are four basic results of this check. If the calculated tax amount is less than the minimum amount defined, the withholding tax amount is zero. If the expected tax amount lies between the minimum and maximum amounts you have defined, the calculated tax amount is the expected tax amount. If the expected tax amount exceeds the maximum amount defined, the maximum tax amount is used. If the tax base amount in the document is less than the defined minimum tax base amount, no tax is deducted and the withholding tax amount is zero.

In the withholding tax base exemption amount field, you can specify an amount that is deducted when calculating the withholding tax base. The amount of the tax exemption does not have any effect when matching the withholding tax base with the minimum, because the base and the minimum are matched before the tax-exempt amount is deducted.

Please note that if you want to change the valid-from date for a tax code, you need to create a new entry for this tax code and specify the new valid-from date. Furthermore, various calculations are made in the first local currency of the respective company code. This means that you must maintain the amounts in the country/region currency of the company code country.