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The objective of this blog post is to inform you which enhancements you can find in SAP Business ByDesign 22.11 release regarding the File and Form for 1042-S Withholding Tax Return. These enhancements were done in order to be compliant with the current regulation published by the IRS.
You can find those new fields in the Business Partner Data work center under Suppliers. Select particular supplier and click on Edit button. Under the tab Financial Data; subtab Tax Data in the section Tax Numbers there is a possibility to select new Tax Number Type "Global Intermediary Identification Number (GIIN)".
Under the section Withholding Tax Classification for the Tax Rate Type "Liable to Withholding 1042S" new fields are available in the section Details.
You can find the new Tax Number Type in the Tax Management work center under Company Tax Arrangements. Select particular company and under tab Company Tax Arrangements; subtab Tax Numbers the new "Global Intermediary Identification Number" is available.
The rest of new fields you can find under the tab Company Tax Arrangements; subtab Tax Return Arrangements; section Withholding Agent Details for the Tax Return Type 1042S.
All the new fields mentioned above are properly mapped to the Form 1042-S (Copy B) and reflected in the File 1042-S on the positions according to the definition published in the Publication 1187 For Tax Year 2022.
This explanation should help you to understand what enhancement was done within 1042-S Withholding Tax Return. With these changes the reporting of the 1042-S will be compliant with the current Internal Revenue Service regulations.
- Income Types, Tax Rate Types and Withholding Tax Codes were updated in the Business Configuration work center, following the 2022 Instructions for Form 1042-S and Publication 1187 For Tax Year 2022 published by the IRS.
- New fields are available in the Supplier Master Data
- Global Intermediary Identification Number (GIIN)
- Chapter Indicator
- Chapter 3 and 4 Status Codes
- Chapter 3 and 4 Exemption Codes
- LOB Treaty Category
- Withholding Tax Income Type
You can find those new fields in the Business Partner Data work center under Suppliers. Select particular supplier and click on Edit button. Under the tab Financial Data; subtab Tax Data in the section Tax Numbers there is a possibility to select new Tax Number Type "Global Intermediary Identification Number (GIIN)".
Under the section Withholding Tax Classification for the Tax Rate Type "Liable to Withholding 1042S" new fields are available in the section Details.
3. New fields are available in the Company Tax Arrangement
- Chapter Indicator
- Chapter 3 Status Code
- Chapter 4 Status Code
- Global Intermediary Identification Number (GIIN)
You can find the new Tax Number Type in the Tax Management work center under Company Tax Arrangements. Select particular company and under tab Company Tax Arrangements; subtab Tax Numbers the new "Global Intermediary Identification Number" is available.
The rest of new fields you can find under the tab Company Tax Arrangements; subtab Tax Return Arrangements; section Withholding Agent Details for the Tax Return Type 1042S.
4. Form 1042-S enhancement
- the wording in the header and the footer of the Form was updated
- Unique form identifier is filled in
- Amendment checkbox is checked if 1042-S Withholding Tax Return is corrected
- Amendment number is filled in if 1042-S Withholding Tax Return is corrected
All the new fields mentioned above are properly mapped to the Form 1042-S (Copy B) and reflected in the File 1042-S on the positions according to the definition published in the Publication 1187 For Tax Year 2022.
This explanation should help you to understand what enhancement was done within 1042-S Withholding Tax Return. With these changes the reporting of the 1042-S will be compliant with the current Internal Revenue Service regulations.
