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GST adjustment after payment discount

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Posted on by Raghav3022

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Hi,

Is there a solution to adjust GST amount accordingly if payment discount is posted.

In my sales invoice i have given 2 percent cash discount for early payment.

Now when the payment is made within the date, how do we adjust the taxable amount and the GST.

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Dynamics 365 Business Central

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Mansi Soni 8,907 Super User 2025 Season 2 on at

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In Business Central, you can adjust the GST amount when a payment discount is applied by enabling the "Adjust for Payment Discount" option in the VAT Posting Setup. When this setting is enabled, the system automatically recalculates the taxable amount and adjusts the GST accordingly when the payment is made within the discount period.

To configure this: Go to VAT Posting Setup > Enable "Adjust for Payment Discount"

Hope this setup might solve your question!

Regards
Mansi Soni

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Jainam M. Kothari 15,639 Super User 2025 Season 2 on at

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Hello,

For Adjusting GST Amount, You can use the GST Adjustment Journal.

https://learn.microsoft.com/en-us/dynamics365/business-central/localfunctionality/india/gst-input-tax-credit-adjustment

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Gerardo Rentería Ga... 25,225 Most Valuable Professional on at

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Hi, good day
I hope this can help you, and give you some hints.

Payment tolerance and payment discount tolerance - Business Central | Microsoft Learn

Best Regards
Gerardo

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Ramesh Kumar 7,527 Super User 2025 Season 2 on at

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Hi Raghav,

You do have option to VAT posting set.

https://learn.microsoft.com/en-au/dynamics365/business-central/finance-payment-tolerance-and-payment-discount-tolerance

Thanks

Ramesh

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Jun Wang 8,202 Super User 2025 Season 2 on at

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My understanding is the payment terms should be taking care of such situation. If the invoice is paid within the period that allows a discount, BC will automatically calculate the amount due. Fore example, the taxable amount is 100 and the tax is 10. The discount is 2%. The customer needs to pay 107.8

Also, if the invoice has been posted, user won't be able to adjust the taxable amount and the GST directly on the posted invoice. If you do need to reduce the original amount, what you could do is to create a credit memo to reduce it. After this is done, you could apply the payment to the invoice.

If reduced the taxable amount, the payment term will further reduce the amount due as well. So it will not be a good idea in my opinion.

Hope it helps

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Khushbu Rajvi. 20,439 Super User 2025 Season 2 on at

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Hope this helps as well: https://community.dynamics.com/blogs/post/?postid=3d4d01be-4204-4a64-9a5a-3a72270df041

https://community.dynamics.com/forums/thread/details/?threadid=637fd327-7235-4efe-aaa9-b69fc5501a20

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Vahid Ghafarpour 12,133 Super User 2025 Season 2 on at

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