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Slabwise Withholding Tax

Former Member
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Dear Experts,

Withholding Tax on Contractors for Bangladesh is having slapwise, where I am using the formula based withholding calculation, but the output calculation is not correct as per the slab.

In formula i have use as under;

1,00,000 0

5,00,000 1%

15,00,000 2.5%

25,00,000 3.5%

99,99,999 4.0%

Below is the client requirement

The tax rate for supplier is always calculated on cumulative amount paid in a financial year. The rate is

Payment upto 1,00,000 Nil,

Payment exceed 1,00,000 but less than 5,00,000 is 1%

Payment exceed 5,00,000 but less than 15,00,000 is 2.5%

Payment exceed 15,00,000 but less than 25,00,000 is 3.5%

Payment exceed 25,00,000 is 4%

For Example,

1) If 1st payment is 25,000, the tax is nill.

2) If 2nd payment is 90,000, then tax is

Total payment (25,000+90,000)= 115000 @ 1% = 1150

3) If the 3rd payment is 500000, then tax is,

Total payment (25,00090,0005,00,000)= 6,15,000 @ 2.5%= 15375 u2013 1150 ( earlier tax deducted) = 14225

4) If the 4th payment is 1200000, then tax is

Total payment (25000900005000001200000)= 1815000 @ 3.5% = 63625- (115014225)= 48150

5) If the 5th payment is 700000, then tax is

Total payment (25000900005000001200000700000)= 2515000@4% = 100600- (11501422548150)= 37075

Please give your valuable suggestion for the withholding settings.

Thanks in advance


Accepted Solutions (0)

Answers (2)

Answers (2)

Former Member
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In withholding tax type, Accumulation Type select no accumalation if the limits are for each invoice.


Former Member
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Dear Sayed

Kindly Check the following Settings in your WHT Configuration :

1) In WHT Type Choose Gross Amount, Post W/tax Amount, Accumulation type per year starting with month 4, Base Amount and w/tax amount based on WHT Code.

2) In WHT Code Choose Percentage subject to tax 100%, Calculation W/tax Formula

3) In Define Formula for calculating W/tax enter :

1,00,000 0

5,00,000 1%

15,00,000 2.5%

25,00,000 3.5%

99,99,999 4.0%

4) Enter Receipant type as Corporate or non Corporate

5) Assign W/tax type to CoCode and Choose W/tax agent and Activate Extended W/tax

6) Assign W/tax type and Code to vendor master and also tick liable for deducting tax

Hope it Solves !!

If doesnot then tell me the error message or amount of wrong deduction



Former Member
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Dear Inder Mohan,

Thanks for your Inputs, basically I had also used the same configuration for calculating TDS.

The only issue is when it moves from one slab to another slab then the TDS is calculating for both the slabs for eg; the invoice value is 600000.

100000-500000 -> 1.0% -> 5000 and

500000-1500000 -> 2.5% -> 15000

My point is system should not calculate for the first slab once it reaches the second slab. The TDS should be only 15000. But in this case the system is calculating 20000 (15000+5000).

Please guide me in this issues.



Former Member
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Hello Dear

You need to alter your formula screen as follows :

In Define Formula for calculating W/tax enter :

Upto Base Amt = Tax Rate = Decrese Base Amt

1,00,000 = 0 = 0

5,00,000 = 1%= 1,00,000

15,00,000 = 2.5% = 5,00,000

25,00,000 = 3.5% = 15,00,000

99,99,999 = 4.0% = 25,00,000

When you do like this you will be getting tds deducted at succeeding rate

Hope it Helps



Former Member
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Dear experts,

The solution that is kindly shared above on Bangladesh Withholding tax does not seem to work. I have tried to use the minimum amount setup, and also the reduction of the base amount. I am not able to get the figures which was also as per my client's requirement (which is as per the calculations mentioned in the earlier posts)

Appreciate your advice greatly on this matter.

Maybe Sayed can share what is the solution used on how to obtain the figures as per outlined in the earlier posts.

Thanks alot in advance.

Former Member
0 Kudos

Dear all,

I managed to find out the solution to obtain exactly the requirements and calculations above.

Please refer to SAP OSS note 671917 for more information.

Also, please remember to setup the following:

1) Setup withholding tax country

2) Setup the withholding tax type as accumulative

3) Tick the W.Tax.Form indicator in the withholding tax code.

Hope it helps! I found my solution and how it works for everyone who is setting up Bangladesh WHT.