3733865 - Inclusion of Open Invoices in Spain Withholding Tax Reporting - SAP S/4HANA Cloud Public Edition

• According to Configuration for Withholding Tax Reporting (and similar configuration for other Spain withholding tax reports), it's possible to include open invoices in Spain Withholding Tax Reporting (for example, Modelo 111, 115) by specifying Parameter 'ES_WHT_INCLUDE_OPEN_INVOICES'  to 001 - Include open invoices.
• However, the report still considers clearing date instead of invoice's posting date after parameter 'ES_WHT_INCLUDE_OPEN_INVOICES' has been set to 001.
• The requirement is to include open invoices (posted - but not yet cleared, within the reporting period) in Spain Withholding Tax Report.

SAP S/4HANA Cloud Public Edition.

1. Run Spain withholding tax reports for a given period with Run Statutory Reports app.
2. Observe that only invoices which have been cleared within that period is considered in the report, while open invoices are not included.
3. Activate Parameter ES_WHT_INCLUDE_OPEN_INVOICES and repeat the run; observe that selection logic still bases on document's clearing (payment) date and ignore posting date.

As per the Corporate Taxes, article 65, the obligation to withhold shall arise at the time of the enforceability of the income subject to withholding taxes, or at payment date if it is earlier. (in Spanish: "Con carácter general, las obligaciones de retener y de ingresar a cuenta nacerán en el momento de la exigibilidad de las rentas, dinerarias o en especie, sujetas a retención o ingreso a cuenta, respectivamente, o en el de su pago o entrega si es anterior").

This means that if an invoice is issued today, the withholding tax amount shall be recorded either at the due date (that can be in 30, 60 or 90 days, for example) or at the payment date if earlier, but never at the time the invoice is created. In order to meet this legal mandate, withholding tax is recorded at the time of payment.

The legal statutory report logic work as designed to comply with Spanish local regulations. Always have Parameter ES_WHT_INCLUDE_OPEN_INVOICES set to 000 - Do not include open invoices.

• BOE-A-2015-7771 Real Decreto 634/2015, de 10 de julio, por el que se aprueba el Reglamento del Impuesto sobre Sociedades.
• Withholding Tax Reporting

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