Taxes and charges are included unexpectedly when you compute withholding tax for a transaction in the Indian version of Microsoft Dynamics AX 2009 Service Pack 1

The TDS on any transaction under "Income-tax Act" is required to be deducted on the amount 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 or TCS. Under specific tax deduction type, user has to 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 or TCS). Under withholding tax group form, new field group "Taxes and charges" is created. Under this field group, check box "Exclude tax for TDS or TCS calculation" and look up "Include charges for TDS or TCS calculation" is provided (Navigation path: Main menu > General ledger > Setup > Withholding tax >withholding tax group). On marking check box, exclude tax for TDS or TCS calculation a new button "Taxes" will enable and on click, it will open new form to select different tax type for exclusion of TDS or TCS calculation.

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.htm

In 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.