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Administrator Guide
Last Updated: 2023-06-23
Configure Withholding Tax Rules for Countries

Configure Withholding Tax Rules for Countries

  • Create withholding tax item groups.
  • Security:
    Set Up: Tax
     domain in the Common Financial Management functional area.
For each country, you can specify the withholding tax code that Workday populates on spend and revenue transaction lines that meet the rule criteria. You can also specify rules for each region, if needed.
  1. Access the
    Create Withholding Tax Rule for Country
     task.
  2. In the
    Source Country
     prompt, select the ship-to country that a supplier or customer invoice provides. With no ship-to country, select the country for the primary address of the payer.
  3. As you complete the task, consider:
    Option Description
    Payee Supplier
    The prompt doesn't include contingent workers.
    Payee Country
    Workday uses the primary business address of the:
    • Supplier for supplier invoices.
    • Company for customer invoices.
    Payer Withholding Tax Status
    You can match the withholding tax status of the payer to the source country of the transaction.
    Workday compares this status to the withholding tax status of the:
    • Company for supplier invoices.
    • Customer for customer invoices.
    Payee Withholding Tax Status
    You can match the withholding tax status of the payee to the source country of the transaction.
    Workday compares this status to the withholding tax status of the:
    • Company for supplier invoices.
    • Customer for customer invoices.
  4. Design the country rule lines from top to bottom.
    The best practice is to place rule lines for your most specific use cases first. Place less specific rule lines towards the bottom.
    As you complete the grid, consider:
    Option Description
    Default Tax Code
    When you select this, Workday populates the withholding tax code on the transaction lines.
    Tax Rule for Spend Items
    Tax Rule for Revenue Items
    When you select an item-specific withholding tax rule, Workday evaluates the items within the transaction. If the items match the withholding item-level tax rule, Workday uses the withholding tax code from that rule instead.