Payables and Cash Management - EBS (MOSC)

MOSC Banner

Invoice with Retainage - Tax wrongly calculated on net invoice amount rather than gross amount

edited Oct 12, 2019 5:03AM in Payables and Cash Management - EBS (MOSC) 5 commentsAnswered

Dear All,

We are using complex PO with retention. When we create invoices matched with complex PO, the tax is calculated on the net amount (net of retention amount) rather than gross invoice amount. Below is simple example

PO Amount = 100,000/-

Retention = 15%

Tax Rate = 4% (e-business Tax)

Invoice fully matched to the PO.

System create invoice as below (Distribution)

Item -- 100,000/

Tax (VAT) on item -- 4000

Retention -- (15000)

Tax (VAT) on retention -- (600)

Net Invoice Amount = 88400

This is wrong calculation as per the tax laws. Tax should be calculated on the gross invoice amount only and reversal of 600/- on retention should not take place. Is there a way that we can control this behavior and get the correct tax value on such transactions i.e. VAT = 4000 on this transaction.

Howdy, Stranger!

Log In

To view full details, sign in to My Oracle Support Community.

Register

Don't have a My Oracle Support Community account? Click here to get started.

Category Leaderboard

Top contributors this month

New to My Oracle Support Community? Visit our Welcome Center

MOSC Help Center