(BRA) Set up a withholding tax
Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2
Use this procedure to set up a withholding tax code, a withholding tax type, and a calculation parameter to calculate withholding taxes for consultancy services or professional service payments. You can also enter values for the withholding tax code by using the Withholding tax values form.
Example
The following table explains how withholding tax is calculated as a percentage of a payment amount in a month.
Invoice number |
Invoice date |
Invoice amount |
Withholding tax code (Origin – Percentage of gross amount in a month) |
Minimum limit |
Payment date |
Payment journal amount |
|---|---|---|---|---|---|---|
123 |
November 15, 2013 |
BRL 4000.00 |
10 percent |
BRL 5000.00 |
November 25, 2013 |
BRL 4000.00. Because the amount has not exceeded the minimum limit, no withholding tax is applicable to invoice 123. |
345 |
November 20, 2013 |
BRL 2000.00 |
10 percent |
BRL 5000.00 |
November28, 2013 |
BRL 1400.00, which is the amount that remains after you deduct the withholding tax (BRL 2000 – BRL 600). BRL 600 is the net of withholding tax (6000*10%). 6000.00 is the sum of invoices 123 and 345, to which withholding taxes apply as a percentage of the payment amount in a month. |
Click General ledger > Setup > Withholding tax > Withholding tax codes.
Click New to create a withholding tax code. In the Withholding tax name field, enter the name for the withholding tax code.
In the Brazilian tax withhold type field, select a type of withholding tax from the following options:
PIS – The Programa de Integração Social (PIS) tax is withheld by vendors or customers for consultancy or professional service payments.
COFINS – The Contribuição para o Financiamente da Securidade Social (COFINS) tax is withheld by vendors or customers for consultancy or professional service payments.
CSLL – The Contribuição Social sobre Lucro Líquido (CSLL) tax is withheld by vendors or customers for consultancy or professional service payments.
PCC – The combination of PIS, COFINS, and CSLL tax codes. This option is used to withhold taxes by vendors or customers for consultancy or professional service payments.
IR – The Imposto de Renda Retido na Fonte (IR) tax is retained by vendors or customers at the time when the fiscal document is posted.
On the General FastTab, in the Currency field, select the company currency for the calculation of the withholding tax payment.
Notes
The withholding tax code currency should be the same as the default currency that is set up in the Legal entities form when Percentage of gross amount in month is selected in the Origin field.
On the Calculation FastTab, in the Origin field, select Percentage of gross amount in month to calculate withholding taxes.
Notes
The withholding tax is calculated, taking into account all of the payments, including the sales tax, that are made to a vendor in the same calendar month. The withholding tax calculation includes all of the invoices that are due to be paid to a vendor during that month.
Click Values to enter the values for the withholding tax code. For more information, see Valeurs de retenue à la source (écran).
In the Minimum limit field, enter the minimum base amount for the calculation of the withholding tax.
In the Value field, enter the percentage that is used for the calculation of the withholding tax.
See also
(BRA) Withholding tax codes (modified form)
(BRA) Legal entities (modified form)
(BRA) Withholding tax payments inquiry (form)
(BRA) Set up a withholding tax group and attach it to a customer or vendor