How to Manually Correct Automatic Withholding Done at Payment Time Without Voiding the

Payment (Doc ID 1633234.1)

In this Document

Goal

Solution

Applies to:

Oracle Payables - Version 12.1.3 and later

Information in this document applies to any platform.

Goal

A Withholding group was including on an invoice in error. There should have been no
withholding. Withholding was calculated for the invoice during Payment. The payment can not be
voided, as it was sent to the supplier and pays multiple invoices. We have underpaid the supplier by the
amount of the withhholding.

Solution

There is no way to remove the original AWT Line, as it was created automatically during the payment
process. The only way to reverse system generated AWT is to reverse the activity that generated it. In
this specific case, that would mean voiding the payment for this invoice, because the AWT needs to stay
in sync with the original activity. That is the standard functionality.

You can create a Debit Memo for the negative amount of the original invoice and match it to the
original invoice. This will create an invoice with same accounting and the exact opposite amount for the
Lines / Distributions. Then you create a new invoice for the original amount with the same Item Line
attributes (amount, account, etc). This time you clear out the Payment Withholding Tax field value on
the line. The description for these new invoices should explain that they are created to correct the
errant AWT created during payment.
Pay these two new invoice on the same payment.

An example.

Invoice A was created for 100.00 with a single line and distribution. The line was incorrectly set with a
payment withholding tax group with 10% withholding.

Invoice A is paid and the AWT is applied. The payment is for 90.00 and as a result there is an AWT
line/distribution for -10.00 created on Invoice A. There is no way to manually discard this line.

To correct this we create a Debit Memo B for -100.00 and match it Invoice A. We also create Invoice C
for 100.00 with the same accounting and amount as Invoice A, but making sure there is no value for
Payment Withholding Group on the Lines.

Next we pay Debit Memo B and Invoice C on the same payment. Debit Memo B will be paid for -90.00
and as a result there is an AWT line/distribution for 10.00 created on Debit Memo B. Invoice C will be
paid for 100.00. This will result in a net 10.00 payment. The overall net payment is 100.00. The -10
AWT for Invoice A and the 10.00 AWT for Invoice C cancel each other out.