How to Handle Jordanian “5% Vendors Service Tax” in Microsoft Dynamics GP??

I got many requests from my customers on how to automatically manage the newly added governmental 5% Vendors Service Tax on all service vendors payments, with few hints from friends and researches, I been able to handle this tax using the built in Withholding Tax, below are the steps required to setup the tax:

1. Go to “Microsoft Dynamics GP menu >> Tools >> Setup >> Company >> Company” and click on “Options”:

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Setup the tax committee as a vendor in your AP and fill it in the above form.

Go to “Cards >> Purchasing >> Vendor” and click on the added “Withholding” button, mark this vendor to be subject to the withholding deduction and define the deduction percent:

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Now go to AP Transaction Entry “Transactions >> Purchasing >> Transaction Entry” and select your vendor, where a message will popup checking if this invoice will be subject to withholding:

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So far, nothing will be affected financially but the document will be marked for deduction on the next payment.

To pay this vendor, go to “Transactions >> Purchasing >> Manual Payments” and select your vendor, then fill the amount you need to pay, and apply this payment the to invoice, where the system will automatically calculate the withholding amount as shown below:

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Open the distribution and make sure that the Withholding Account “WH” was added to your invoice.

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Post the payment and enjoy having the tax automatically calculated.

Regards,

Mohammad R. Daoud – CTO
MVP, MCP, MCBMSP, MCTS, MCBMSS
+962 – 79 – 999 65 85 
mohdaoud@gmail.com
mohdaoud.blogspot.com

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About Mohammad R. Daoud
Mohammad R. Daoud has been working as a Microsoft Dynamics GP consultant since 2004. His career path started with version 7.5; he studied every single tip of the application technicalities and did allot of successful implementations that includes functional consultations, analysis, and custom development projects. He holds a graduate degree in Computer Science and currently he is pursuing MBA degree in Accounting. In January 2007 he was nominated to the Microsoft Most Valuable Professional (MVP) certificate and was certified in April 2008 due to his online contributions in the Dynamics Community (Dynamics GP Newsgroups, Forums, User Groups and his blog: http://mohdaoud.blogspot.com). Worth to mention that he was also listed as one of the Microsoft Dynamics Top 100 Most Influential People in 2009 by DynamicsWorld. And more... • Demonstrated Passion for MS Products through participating in beta testing for some product versions, an effective member of Microsoft Connect. • Talented in securing strong high quality relationships with premier customers, partners and sales teams passionately and profitably. • Dedicated to meeting the expectations and requirements of internal and/or external customers • Problem Solver – Uses systematic approach to uncover true problem(s) and practical solution and can marshal resources to solve problem! • Proven record of effective account management, including Account Planning, Opportunity Management, and Business Management Excellence and working as part of a larger virtual team • Successful in delivering high quality technical engagements in the enterprise Dynamics GP implementations area according to customer requirements. • Dedicated, Committed, Self Motivated, Creative and highly focused with excellent communication, Negotiation, presentation, Active Listening and Objection Handling skills. • Experienced in Profitable researches and studies including white papers and technical presentations.

4 Responses to How to Handle Jordanian “54 Vendors Service Tax” in Microsoft Dynamics GP??

  1. Anonymous says:

    Thank you Mohammed for this good explanation, but the following cases still waiting to be finalized:

    1. Is it applicable if the vendor invoice was received through purchase order?

    2. How to use the “apply” button to pay part of the invoice?

    3. Are we able not to apply the Withholding Tax on invoice was originally marked to be subject to this tax?

    4. Reverse to question 3; are we able to apply the withholding tax to invoice wasn’t marked to be subject to this tax?

    Mohammad Shaltaf

  2. Amjad says:

    AmjadThanks Mohammad, waiting your clarifications on Shaltafs memos.

    Amjad.S

  3. 1. Is it applicable if the vendor invoice was received through purchase order?

    YES, it integrates POP module as well.

    2. How to use the “apply” button to pay part of the invoice?

    The tax will be deducted on the last payment appied to the invoice.

    3. Are we able not to apply the Withholding Tax on invoice was originally marked to be subject to this tax?

    NO

    4. Reverse to question 3; are we able to apply the withholding tax to invoice wasn’t marked to be subject to this tax?

    NO

  4. Anonymous says:

    Thank you Mohammed but i'm having an issue with one of my entries. I’m trying enter a manual payment entry. When i select the vendor which has a currency of GBP the Apply button is grayed out. The functional current for this company is USD. Any help would be greatly appreciated. Thanks.

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