R12.1:JL:AP: ER 26086830 Withholding Tax For Amount Ranges Not Applied Correctly for El Salvador
Last updated on APRIL 09, 2018
Applies to:Oracle Financials for the Americas - Version 12.1 and later
Information in this document applies to any platform.
On : 12.1.3 version, Invoices TAX and WITHHOLDING
Withholding Tax for amount ranges is not applied correctly.
a) For any invoice amount <=1,000.00 the withholding tax rate should be 0%
b) For any invoice amount >=1,000.00 the withholding tax rate should be 1%
The issue can be reproduced at will with the following steps:
1. Responsibility: Oracle Payables - 12.1.3
The withholding tax has been setup with the 'Rate Structure' as 'Amount Ranges'.
2. Path: Invoices -> Entry -> Invoices
3. Create an invoice and save.
4. Validate the invoice
For any invoice amount <=1,000.00 the withholding tax rate should be 0%
For any invoice amount >=1,000.00 the withholding tax rate should be 1%
However, a withholding tax invoice is created correctly for supplier invoice amounts <=1,000.00 but not for invoice amounts > 1,000.00
The issue has the following business impact:
Due to this issue, withholding tax is not correctly applied.
Customer in the middle of a global implementation.
There is a legal taxation requirement which implies to calculate the withholding tax only if the withholding base amount exceeds the minimum base amount.
The minimum base amount has to be defined as a parameter.
Countries such as Argentina and Colombia already have this setup as part of localization.
Country El Salvador also requires this setup.
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