Editing TDS/TCS withholding TAX at the time of Invoicing Purchase Order in Indian Entities

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Posted on by AX_Consultant

I exactly want to know the Whether it is advisable to EDIT the TDS/TCS Group at the Time of Purchase Invoicing.

As this scenario is about the Indian Localization.

Kindly let me know if you need more information on this.

Thanks

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Ludwig Reinhard Microsoft Employee on at

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Hi AX Consultant,

Withholding tax is usually related to the time a payment is made.

Why would you post this tax already before and how would you account and report for it? That is, how would you explain the transactions generated to your auditors?

Best regards,

Ludwig

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AX_Consultant 73 on at

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Hello Ludwig,

Thanks for the above, but as per Indian tax law.

Organization need to account withholding tax at the time of vendor invoice booking.

Accounting treatment is as under

Expenses Dr 100

To Vendor Cr 100

Vendor Dr. 10 (assuming withholding tax 10%)

To Withholding Tax payable Cr 10

In case of advance payment to vendor organization need to deduct withholding tax.

On purchase invoice form carries TDS (withholding tax) details from purchase order, some time accounting team need to update correct TDS group if vendor is providing multiple services.

Let me know if you need more information on this.

Thanks

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Ludwig Reinhard Microsoft Employee on at

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Hi AX Consultant,

I am not familiar with the Indian tax law and cannot really comment on that.

Yet, the good news is that we have quite a number of Indian specialists in the community forum.

Let's please wait for their response.

I would assume that there is a country specific feature available for that but don't know details.

If you don't receive another response with in the next days, let us know.

Many thanks and best regards,

Ludwig

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Community Member on at

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Hi AX Consultant,

Hope your query is resolved. Dynamics does not post withholding tax separately in vendor ledger whether it is TDS or TCS. Yes TCS can be calculated on purchase order or on invoice journal. We have to define TCS group on the vendor master for this purpose.

Thanks & best regards

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Community Member on at

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Moreover practically it is possible to have multiple withholding tax group applicable for one vendor and for that purpose, the same needs to be edit at the transaction level.

Thanks & best regards

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