This article applies to Microsoft Dynamics AX for all regions.

Symptoms

In the India version of Microsoft Dynamics AX 2012 R2, you experience one of the following issues:

  • When you compute withholding tax (either tax deduction at source (TDS) or tax collection at source (TCS)) for a transaction than Indirect taxes and charges are automatically included in the gross transaction value for computation of withholding tax in Microsoft Dynamics AX 2012 R2.

    In certain specific scenario where withholding tax on a transaction required to be computed excluding indirect taxes and charges than incorrect withholding tax amount is computed and displayed by the system.

  • When you create a purchase order from a sales order, the tax collection at source (TCS) group field will be empty in interconnected transaction but it will be updated automatically in inter-company transaction.

INTRODUCTION

This article describes that a country-specific update is available to exclude "Indirect taxes" or "charges" for withholding tax (TDS or TCS) calculation in Microsoft Dynamics AX 2012 R2.

Resolution

The tax deduction at source (TDS) on rent under Income-tax Act is required to be deducted on the rent paid or payable excluding the service tax. While as per existing localization indirect tax amount and charges are automatically included in the gross transaction value for computation of TDS/TCS, while under specific tax deduction type user can exclude taxes and charges for computation of TDS or TCS.

This hotfix will enable you to exclude or include any tax or charges for withholding tax calculation (TDS/TCS). Two new lookup menu Exclude tax for TDS or TCS calculation and Include charges for TDS or TCS calculation is provided under withholding tax group (Navigation path: Main menu > General ledger > Setup > Withholding tax > withholding tax group) to exclude indirect taxes and charges for withholding tax calculation.

Two new fields Exclude tax for TDS or TCS calculation and Exclude charges for TDS or TCS calculation are added in the General tab of withholding tax group would be visible only when you unmark and mark again the parameter for TDS or TCS in General Ledger parameters form.

After you apply this fix, the tax collection at source (TCS) group field will be updated in intercompany transaction automatically. However, in case of inter-connected transaction, for example, purchase order from sales order, the TCS group filed will be blank. You have to select TCS group manually.

Hotfix information

A supported hotfix is available from Microsoft. There is a "Hotfix Download Available" section at the top of this Knowledge Base article. If you are encountering an issue downloading, installing this hotfix, or have other technical support questions, contact your partner or, if enrolled in a support plan directly with Microsoft, you can contact technical support for Microsoft Dynamics and create a new support request. To do this, visit the following Microsoft website:

https://mbs.microsoft.com/support/newstart.aspx You can also contact technical support for Microsoft Dynamics by phone using these links for country specific phone numbers. To do this, visit one of the following Microsoft websites:

Partners

https://mbs.microsoft.com/partnersource/support/Customers

https://mbs.microsoft.com/customersource/support/information/SupportInformation/global_support_contacts_eng.htmIn special cases, charges that are ordinarily incurred for support calls may be canceled if a Technical Support Professional for Microsoft Dynamics and related products determines that a specific update will resolve your problem. The usual support costs will apply to any additional support questions and issues that do not qualify for the specific update in question.

Installation information

If you have customizations for one or more of the methods or the tables that are affected by this hotfix, you must apply these changes in a test environment before you apply the hotfix in a production environment.

For more information about how to install this hotfix, click the following article number to view the article in the Microsoft Knowledge Base:

893082 How to install a Microsoft Dynamics AX hotfix

Prerequisites

You must have the India version of Microsoft Dynamics AX 2012 R2 installed to apply this hotfix.

Restart requirement

You must restart the Application Object Server (AOS) service after you apply the hotfix.

File information

The global version of this hotfix has the file attributes (or later file attributes) that are listed in the following table. The dates and times for these files are listed in Coordinated Universal Time (UTC). When you view the file information, it is converted to local time. To find the difference between UTC and local time, use the Time Zone tab in the Date and Time item in Control Panel.

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