Withholding Tax

MrsWright
MrsWright Registered Posts: 19
in Chat and off-topic discussion
Hi
Can anyone shed some light on how to account for Sales Withholding Tax?
We have an overseas customer who have an obligation to deduct withholding tax from any purchases they make so they can pass it on to their own government.
They have paid us the amount on the invoice less £301.35 which I assume is the tax amount withheld as there were no bank charges included in that figure. The full amount of the invoice was posted to Sage around £8k but I am now this tax amount short.
What does this tax represent exactly? Can we reclaim it? Is this amount deducted from Sales? What is the double entry? I have not dealt with this before and neither has my manager? Any help appreciated and thanks in advance!

Comments

  • Neillaw
    Neillaw Registered Posts: 308 Dedicated contributor 🦉
    Is this Thailand?
  • MrsWright
    MrsWright Registered Posts: 19
    No, it is Yangon (Myanmar)
  • Neillaw
    Neillaw Registered Posts: 308 Dedicated contributor 🦉
    Sorry I know the rules for Thailand - but I would check as when dealing with Withholding tax its usually for sales within the same country and if imported or exported no tax is chargeable.
    It may be worth looking through their version of HMRC.

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