| # To set up withholding tax To set up withholding tax and social contributions, take the following steps: Set up the parameters In the Implemented Software Components (tccom0100s000) session, select the Withholding Income Tax && Social Contribution check box. To charge withholding tax on advance payments, in the CMG Parameters (tfcmg0100s000) session, select the Calculate Tax on Advance Payments/Receipts check box. Define the tax categories To distinguish various types of withholding tax in your reports, define the tax categories required for your country in the Tax Categories (tctax0115m000) session. Define tax base value formulas For tax categories for which the tax amounts are not based on the net goods value amounts, you can define the algorithm used to determine the tax base value. For details, refer to To define tax base value formulas. Define the tax codes Define the tax codes, the tax rates, and the tax posting data as described in To set up tax registration. The following details are especially important: Kind of Tax Select Withholding Income Tax. For details, refer to Kinds of tax. Tax rates If the tax consists of a single rate, define a singular tax code. If the tax consists of different rates on separate parts of the amount, define a multiple tax code. Tax Base Value Formula For the tax codes for which you defined a tax base value formula as described in Step 3, in the Tax Codes by Country (tcmcs0136s000) session, select the tax base formula in the Tax Base Value Formula field. In one country, tax codes of the same tax category must have the same tax base value formula. Payable periodically or at invoice payment In Pay Tax field of the Tax Codes by Country (tcmcs0136s000) session, select Periodically. In the Tax Type field, select Normal. Approve the tax codes Before you can link the tax codes to a group tax code, in the Tax Codes by Country (tcmcs0136s000) session, you must select the Approved check box for each tax code. Define a group tax code as described in To set up a group tax code. Set up the business partners for withholding tax Set up the details for your business partners as described in To set up business partners for withholding tax. Related topics Tax deducted at source (TDS) - overview To set up tax registration |