E1: 76A: LOC:AR Processing Negative or Zero Dollar Profit Withholding Payment
Last updated on AUGUST 22, 2017
Applies to:JD Edwards EnterpriseOne Accounts Payable - Version XE and later
Information in this document applies to any platform.
How to calculate and update monthly accumulates for Profit Withholding when the payment group includes debit notes (negative vouchers) and when calculated with Create Payment Control Group (P04570), the total amount is zero or negative.
Legal Resolution (RG 830) states that Profit Withholding must be calculated on the whole taxable amount, without deductions for compensations, affectations and any other concept that deducts it except for taxes such as VAT, Perceptions, Internal Taxes, etc.
With present functionality, if the sum of positive and negative vouchers (debit notes, withholding vouchers) in a payment group totals a negative or zero amount, the payment is not issued.
VAT $ 21.000
Gross $ 121.000
PD 020700000227 (Debit Note)
Gross ($ 110.000)
Net to pay $ 11.000 (a)
Profit ($ 1.760)
VAT ($ 16.800)
S.U.S.S. ($ 1.000)
Total Withholding ($ 19.560) (b)
(a) - (b) = ( $ 8.560)
With this amount, the Create Payment Control Group (P04570) does not make the payment and the vouchers will remain pending.
According to Retention Laws; VAT, Profit and SUSS Withholdings must be calculated (when a compensation takes place) up to the voucher total and withhold until the payment amount becomes null. That is, minor retention than the calculated, must be done.
The law does not explain anywhere the heirarchial order to apply the withholdings, so it's done according to the company's tax department.
Following the example:
If Net to pay is $11.000 before withholdings, then
VAT Retention ($11.000)
Profit Retention $0
SUSS Retention $0
So, the application of vouchers takes place. The taxable amount must be updated for the monthly profit accumulates, although the Profit Retention equals zero.
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