Internal loan in some countries have withholding tax on the interest amount, the interest should then be deducted with the WHT amount. This is only applicable if the loan is between Legal entities in different countries. To add a withholding tax to an internal deposit follow the steps below.
- Go to Master data and choose Countries
- Choose the relevant Country and enter the tax rate
- Open Master Data/Master Data and in Companies enter Country or Country code for all subsidiaries in a countries where WHT is applicable
- Accounting rules Loan, enter accounts in line WHT receive and WHT Pay
Next time a Deposit from Legal entity Treasury to a Subsidiary in a country with WHT tax, the system will automatically calculate and the WHT will be deducted from the interest in the payment.
It is possible to see the net receiving amount by clicking on icon View deal cash flow
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