Withholding tax and Gross amount determination

Question

Dear all
First of all, I would like to underline that before to post in this forum I have read all the documentation (official and not official) related to the Withholding Tax configuration in SAP, but in the end I have some doubts and so I kindly ask you cooperation to better understand the logical of the system.
In our country (ITLAY) the withholding tax (WTH tax) must be withheld at the payment invoice to the vendor, so our system should automatically calculate and posts the amount to the right tax account; my question is: which setting we have to use in order to have the right calculation of the base amount?
When you enter the invoice, the system determines the base amount for withholding tax and stores it in the document (INVOICE ENTRY SIDE). You can also enter the base amount directly. When the invoice is paid, the tax amount is calculated from the base amount and your specifications for the tax code. If the tax amount is to be paid to the tax authorities, the system automatically posts the amount to the tax account. The system reduces the payment amount to the vendor by the withholding tax to be paid (INVOICE PAYMENT SIDE).
At the Invoice Entry SIDE when entering documents, if the withholding tax is to be calculated at the time payment is made, only the base amount is calculated when the invoice is posted, this is what we are looking for, so my question is:
How does the system calculate the base amount of WTH tax?
Maybe an example could be better to explain our request:
Invoice received from a Tax adviser that is liable to Withholding tax.
1.     Invoice Total Amount                                                  1372 €
2.     Fees (Tax Base amount and WHT Tax base amount)                         1000 €
3.     Specific Italian Contribution     (Tax Base amount and NO WHT Tax base amount)          20 €
4.     Social Security Contribution     (Tax Base amount and WHT Tax base amount)          40 €
5.     Expenses reimbursement (NO Tax Base amount and NO WHT Tax base amount)          100 €
6.     VAT Basis (point 2 + 3 + 4)                                             1060 €
7.     VAT Amount (20%)                                                  212 €
8.     Withholding Tax Basis (point 2 + 4)                                        1040 €
9.     Withholding Tax Amount (20%)                                        208 €
Is it possible to manage this flow under the Invoice Verification FLOW? It means:
1.     Issue a Purchase Order to the TAX consultant
2.     post the GR for services
3.     post the IR, in this step the System should calculate the WTH base amount 1040€
4.     post the payment and the WTH TAX
Accounting flow is:
Point 2) post the GR for services
         Credit      Balance Sheet GRIR services account                                   -1040€
         Debit      P&L Account for services                                             1040€
Point 3) post the IR
        Credit      Vendor Account                                                   -1372€
        Debit      Balance Sheet GRIR services account                                    1040€
                       WTH TAX BASE AMOUNT
        Debit      P&L Account Expenses reimbursement                                   100€
                        NO TAX BASE AMOUNT AND NO WHT TAX BASE AMOUNT
        Debit      P&L Account Specific Italian Contribution                                   20€
                        TAX BASE AMOUNT AND NO WHT TAX BASE AMOUNT
       Debit     Balance Sheet Tax Account                                             212€
Point 4) post payment to the vendor
      Debit      Vendor Account                                                   1372€
      Credit      Balance Sheet WTH TAX ACCOUNT                                   -208€
     Credit      Balance Sheet Bank Account                                             -1164€
I have just one doubt: for the calculation of the WTH TAX base amount the system consider the amount/value of the GR, so in this case 1040€ or the system will take in consideration all the item for the VAT TAX BASE AMOUNT, so in this case 1060€?
I am asking this because I found on the SAP documentation, when it explain the Withholding Tax Type Calculation Setting:
Gross amount - The withholding tax base amount equals the line item gross amount.
Tax amount - The withholding tax base amount equals the tax amount of the line item.
I know my request is not so clear, and I have to apologize with you because it is very long, but please someone can help me
Regards
Marco

Answer 1

thanks for all folks