Set up withholding tax in System administration and General ledger


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Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012

Withholding tax is a tax on vendors that does not create sales tax transactions. Withholding tax that is calculated on vendor payments is a liability. Therefore, only balance sheet accounts or liability accounts are valid accounts for posting withholding tax.

Withholding tax is reported in fixed reports.

  1. Click System administration > Setup > Licensing > License configuration.

  2. Expand the General ledger node and select the Withholding tax check box.

  3. Click General ledger > Setup > Withholding tax > Withholding tax codes.

  4. Create withholding tax codes with values and limits.

  5. Click General ledger > Setup > Withholding tax > Withholding tax groups.

  6. Create withholding tax groups and add the relevant withholding tax codes on the Setup tab.

See also

(Global, AUS, ITA) Set up withholding tax for a vendor

Calculate and post withholding tax