Some items company pays and some is employee responsible.
If employee responsible. Ex: 10%, amount 100$
Sanctioned amount = 90$
Withholding tax amount = 10$
If company responsible:
Sanctioned amount = 100$
Withholding tax amount = 10$
I assume withholding tax would come into play during Payment entry, maybe it can be handled with entry in deductions or loss table in payment entry.
I assume It would work during Payment Entry with deduction and loss table.
But it’s not right to me, it’s in the GL.
There’re two account for withholding tax 10%, Deductable withholding Tax (DWT) for employee and Nondeductable withholding Tax (NWT) for company responsible.
If employee responsible. Ex: 10%, amount 100$
Sanctioned amount = 90$
Withholding tax amount = 10$
General Ledger should be:
Account | Dr | Cr
expense acc dr | 100 | 0
expense acc cr | 0 | 90
DWT | 0 | 10
If company responsible:
Sanctioned amount = 100$
Withholding tax amount = 10$
General Ledger should be:
Account | Dr | Cr
expense acc dr | 100 | 0
expense acc cr | 0 | 100
DWT | 0 | 10
NWT | 10 | 0
We have started working on this, I understand the GL entry for the employee responsible but not understand for company responsible.
In Expense Claim Detail (item):
Employee responsible (non-deductible = No):
We deducted from Sanction Amount
In GL:
Acc | Dr | Cr
deductible_acc | 0 | 103.50
Expense_acc | 690 (sanctioned + tax) | 0
Payable_acc | 0 | 586.50
Company responsible (non-deductible = Yes):
In GL:
Acc | Dr | Cr
deductible_acc | 0 | 103.50
non-deductible_acc | 103.5 | 0
Expense_acc | 690 | 0
Payable_acc | 0 | 690
Here’s table Withholding Tax which a company has two accounts, deductible and non-deductible.
