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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / TDS Calculation with w...
Small and medium business | Business Central, N...
Answered

TDS Calculation with wrong vendor balance

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Posted on by Dynamics_Decoded_Gokul 463
HI everyone, 
 

We are facing a strange issue while calculating TDS with provisional entries, System is creating a inconsistency entries in GL entry for few of the TDS section codes, This is happening for us without our customization app also. BC Version 24.4 IN. 

We cross checked, TDS Setup, TDS Rates, & Use cases also. its looks similar to our latest tax engine. 

Have you any one encountered this issue? any suggestion and findings are welcome

 

Categories:
Dynamics 365 Business Central
I have the same question (0)
  • Suggested answer
    Saif Ali Sabri Profile Picture
    Saif Ali Sabri 2,351 Super User 2025 Season 2 on at

    It sounds like you're experiencing issues with TDS (Tax Deducted at Source) calculations in Microsoft Dynamics 365 Business Central (BC) Version 24.4 IN for certain TDS section codes. This issue could be related to the latest India localization tax engine within Business Central, and you're observing inconsistent entries in the General Ledger (GL), especially when posting provisional entries. Here are some potential causes and troubleshooting steps to address this issue:

    1. Check for Known Issues and Hotfixes

    • Microsoft regularly releases hotfixes and cumulative updates, especially for country-specific tax engines. Since you are on version 24.4, check if there’s a hotfix or update available specifically for TDS calculations in the India localization.
    • Sometimes, issues with specific section codes or TDS posting inconsistencies are known bugs that get fixed in subsequent updates.

    Action: Visit the Microsoft Business Central release notes or check with your Microsoft partner to confirm if any known issue affects TDS calculations in BC Version 24.4 IN.

    2. Verify TDS Grouping and Threshold Setup

    • In Business Central, TDS calculations depend on several configuration elements, including TDS Section Codes, Thresholds, and TDS Groups. Make sure the thresholds and grouping setups match your business requirements.
    • Sometimes, incorrect grouping or thresholds can cause inconsistent entries, especially if multiple TDS rates apply to a single transaction.

    Action:

    • Go to TDS Section Codes and TDS Groups in your configuration settings.
    • Ensure that the Threshold Limits and TDS Rates are correctly configured and that they correspond to the tax rules for each section code.
    • Cross-check each configuration with recent government regulations to ensure alignment.

    3. Check Provisional Entry Setup and Posting Process

    • Provisional entries can sometimes cause issues with TDS calculations in the GL if not configured correctly. Business Central may handle provisional entries and adjustments differently, particularly if there are multiple tax codes or section codes applied.
    • Ensure that the TDS is being calculated correctly at the time of provisional entry posting and that any adjustments required during final posting are also correctly applied.

    Action:

    • Test posting the same TDS transactions without provisional entries to see if the inconsistency persists. This can help isolate if the issue is specifically with the provisional posting process.
    • Check the Posting Date and Document Date for provisional entries, as mismatches between these dates can sometimes impact tax calculations.

    4. Review Vendor Ledger Entries and TDS Posting Accounts

    • Review the Vendor Ledger Entries and the GL accounts used for TDS postings. Inconsistent or incorrect GL entries may occur if the TDS posting accounts are not properly configured, especially for different section codes.
    • Ensure that each TDS section code is linked to the correct GL accounts for TDS Payable, TDS Expense, and other TDS-related postings.

    Action:

    • Go to General Ledger Setup and TDS Posting Setup to verify that the correct accounts are selected for each section code.
    • Ensure that each TDS section code is properly mapped to the relevant accounts, and that the account mappings are consistent with your chart of accounts.

    5. Run the Consistency Check for TDS Entries

    • Business Central provides a Consistency Check tool that can help identify discrepancies in your data. Running this check can help detect any inconsistencies in TDS entries or other related GL postings.

    Action:

    • Go to Finance > Integrity Check or Tax > Consistency Check (the exact path may vary based on localization) and run the tool to identify any inconsistencies related to TDS calculations.
    • Review the results and fix any issues that are identified by the consistency check.

    6. Validate with Test Transactions for Different Section Codes

    • Since the issue appears only for certain TDS section codes, try posting test transactions for both problematic and non-problematic section codes. This can help pinpoint if there is an issue specific to certain section codes or combinations of section codes.

    Action:

    • Create test transactions with different TDS section codes and post them in a sandbox or test environment.
    • Verify if the GL entries are consistent across different section codes. If inconsistencies only appear for specific codes, this could indicate an issue with the configuration or localization for those codes.

    7. Review the TDS Calculation Code and Business Central Extensions

    • Since you mentioned this happens even without your customizations, it’s possible there’s an underlying issue with the India localization extension provided by Microsoft for TDS calculations.
    • If you have any other extensions or customizations that interact with the tax or posting processes, they may also impact TDS entries indirectly.

    Action:

    • In your Extensions Management, review any active extensions that could impact TDS or tax postings. Try temporarily disabling non-essential extensions and test if the issue persists.
    • Reach out to Microsoft support or your partner to report the issue with the India localization for TDS if you suspect it’s an extension-related bug.

    8. Check Audit Logs for Inconsistent Entries

    • Sometimes inconsistencies in entries can be traced back by reviewing the audit logs. The audit log can provide more context on any manual adjustments or system entries that might have been added to correct or modify the GL entries.

    Action:

    • Go to Audit Log in Finance (if enabled) and check for any manual adjustments or unusual postings around the time of the inconsistent TDS entries.

    Additional Recommendations

    • Test in a Sandbox Environment: If possible, replicate the setup in a sandbox environment to rule out any environmental issues or custom configurations.
    • Consult Microsoft Support: If you’ve exhausted the above troubleshooting steps and the issue persists, it may be best to contact Microsoft support, especially since this involves country-specific localization. They can investigate if it’s a version-specific or localization-specific issue.

    Summary

    1. Check for updates or known issues in the India localization for BC Version 24.4 IN.
    2. Verify TDS setup, including section codes, groups, and thresholds.
    3. Test without provisional entries to see if the issue is specific to provisional postings.
    4. Review vendor ledger entries and posting accounts for correct TDS mappings.
    5. Run a Consistency Check for TDS entries to identify any data issues.
    6. Validate with test transactions for different section codes to isolate the issue.
    7. Review extensions and potential customizations that could impact TDS.
    8. Check audit logs for manual adjustments or unusual system entries.

    These steps should help identify and resolve the inconsistency in TDS calculations. If the issue persists, you might need to engage Microsoft support for further investigation.

  • Verified answer
    Dynamics_Decoded_Gokul Profile Picture
    Dynamics_Decoded_Gokul 463 on at
    This issue is with Indian Localization APP in 24 Version. in the same line if we remove GST credit code - to blank it will calculate properly for the tds provision entries.
     
    Found by Deep diving for 4hours :) 

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