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OFI- GST Withholding Tax Configuration
1 - Introduction
A Withholding tax means the tax deducted at source by the payer of income. It is also called retention tax
In India it is called Tax Deducted at source (TDS).
2 - Scope
This document provides the details of Functional flow for Oracle Financials for India (OFI) Tax Deducted
at Source (TDS) Cycle from GST point of view.
Note: The current content has been compiled in reference to the frozen scope of the
Phase 2 deliverables (Ref: GST Phase -2 Deliverables.docx)
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OFI- GST Withholding Tax Configuration
3 - Setups for Tax Configuration
In this section, we have mentioned the required setups that has to be performed for TDS
3. Regime Registration
4. Tax types
5. Tax rates
6. Tax Categories
7. Common Configuration
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OFI- GST Withholding Tax Configuration
4 - Setups for Withholding Tax (TDS)
Below are the required setups to be done for Withholding Tax
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OFI- GST Withholding Tax Configuration
4.2. Define TDS Tax Calendar
Define a special accounting period as TDS financial Year in standard AP Periods definition UI. This period
should start from 1-Apr and end to 31-Mar of next year as Year type.
After defining this TDS period, the same can be assigned to the TDS regime as TDS financial Year
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(N) India Local Payables Oracle Payables Setup Calendar Accounting Periods
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OFI- GST Withholding Tax Configuration
4.3. Define Regime Registration
Here, we will define the respective Tax Regime used. This Regime name entered is a user-configurable
field and we can enter a value for the Regime Name.
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OFI- GST Withholding Tax Configuration
4.4. Define Tax Type
(N) Oracle Financials for India Tax Configuration Define Tax Type
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OFI- GST Withholding Tax Configuration
4.5. Define Tax Rate
Here, we specify the rate of tax which is supposed to be calculated on the transaction. As per our
requirement, if the tax is Recoverable or inclusive in nature.
(N) Oracle Financials for India Tax Configuration Define Tax Rate
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OFI- GST Withholding Tax Configuration
4.6. Define Tax Category
Define Tax category that has to be used/defaulted while creating the transactions.
(N) Oracle Financials for India Tax Configuration Define Tax Categories
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OFI- GST Withholding Tax Configuration
4.7. Define Common Configuration
(N) Oracle Financials for India Tax Configuration Define Common Configuration
i) Provide tax category that has to be defaulted when Registration number is not
available
ii) Check below check boxes if The TDS invoice generated should be validated and
approved accordingly
Create Pre-Validated TDS Invoice and Credit Memo: IF this checkbox is enabled, system
will invoke Approval of TDS invoice concurrent program to validate created TDS invoices.
Create Pre-Approved TDS Invoice and Credit Memo: IF enabled, system will create TDS
invoices with approve status = NOT REQUIRED
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OFI- GST Withholding Tax Configuration
4.8. Define First Party Registration
Provide the tan number and Pan number of the Organization in the first party Registration.
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(N) Oracle Financials for India Party Registrations Define First Party Registration
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OFI- GST Withholding Tax Configuration
4.9. Define Third Party Registration
Define third party registration for the Suppliers for which the TDS has to be deducted.
Third party registration has to be done for the null site first and then for the site level at the OU
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(N) Oracle Financials for India Party Registrations Define Third Party Registration
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OFI- GST Withholding Tax Configuration
h) Vendor classification has to be added in Reporting Codes Tab
Choose Reporting Type Name as Vendor Type and in the Reporting code field choose
appropriate Value.
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OFI- GST Withholding Tax Configuration
c) Choose Party Name and Party Site and Click On New
d) Select the regime code
e) PAN Number value will be defaulted from Null site level
f) Select the Section code that has to be defaulted
g) At Reporting codes tab classify the Vendor Type
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OFI- GST Withholding Tax Configuration
4.10. Define Threshold Setup
Define the threshold setup for the section code, Regime type and the vendor Type combination
Select Exception setup if the vendor has the TDS certificate. If the Exception setup has been selected
then assign vendors tab will be enabled to define the vendor name, certificate number, start date and end
date
Define the Operating Unit and Tax Category Name that has to be defaulted for the applicable section
code
(N) Oracle Financials for India Withholding Tax Setup Define Withholding Thresholds
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OFI- GST Withholding Tax Configuration
c) Select Threshold Type , From Amount , To Amount , Start date and End date
d) In Taxes section, Select the OU and the Tax Category that has to be defaulted for the
threshold Limit
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OFI- GST Withholding Tax Configuration
5. Applying TDS on Manual Invoice
TDS section code on the invoice will be defaulted based on the Defaulting setup that has been done at
third party registration.
Tax category will be defaulted based on the setup done for the OU and the section code at the threshold
setup
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OFI- GST Withholding Tax Configuration
d) Navigate to TDS Tax details form
(N) Invoice header Click on Tools TDS Tax details
e) Check whether the TDS tax category and section code has been defaulted as per the setup done
f) Check the Overridden check box in case if the tax category or the section has been overridden or
manually applied
j) Re-query the Invoice by Appending % to the Invoice number to verify the standard TDS Invoice
against Tax authority and Credit memo against Supplier has been generated or not
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OFI- GST Withholding Tax Configuration
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OFI- GST Withholding Tax Configuration
6. Applying TDS on Prepayment Invoice.
a) Create a Prepayment Invoice
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OFI- GST Withholding Tax Configuration
d) Validate the Invoice Check whether the TDS invoice has been generated
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OFI- GST Withholding Tax Configuration
e) Make payment for the prepayment Invoice
f) Query the invoice on which the prepayment has to be applied
g) Check whether the same section code has been applied to the invoice as of that prepayment
f) Apply Prepayment Invoice on to invoice
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OFI- GST Withholding Tax Configuration
g) Revalidate the Invoice and verify whether the RTN Invoice has been generated
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OFI- GST Withholding Tax Configuration
7. Summary
The above document will provide the below benefits:
8. Call to Action
Please do the related setup according to the above documentation and perform transactions according to
your business scenarios.
This is not the final document and we will incorporate further changes in this document according to your
queries and Business scenarios.
You can also refer the document in GST Info Center (Document Tab) released as a part of Phase 1 and
Phase 2 deliverables:
E-Business Suite Release 12: India Goods and Service Tax (GST) Info Center (Doc ID 2176820.2)
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OFI- GST Withholding Tax Configuration