Let’s take a look into the ‘Withholding taxes world’ using a great tool that LatamReady offers: ‘THE CONTRIBUTORY CLASS’ in Argentina. Withholding tax can be a difficult concept to understand but here we are to help you! Let’s keep reading to know more.
State the difference!
Withholding taxes usually work in two different ways for example the first one , called ‘perception’, is related to issuing ‘sales’ or ’purchase documents’. The second withholding tax type involves the payment which is called ‘retention’.
What it’s the contributory class?
This revolutionary tool is a custom record made by LatamReady needed to generate the withholding taxes each time you generate a bill payment. Working with the contributory class means setting which transaction you are working with. It must be performed just once, at the beginning of the project or if you want to update some information. Usually each month you should update the different withholding taxes types’ information.
When you generate a “percepcion o retencion de impuestos” it’s necessary to set the ‘type’, ‘subtype’, ‘rate’ and all the details that LatamReady needs to work with for calculation.
Normally in the invoice, we use ‘perception’, which works within NetSuite like a ‘new item line’. This is similar to the withholding tax from NetSuite where you have items and services and then an additional line for the withholding tax.
Withholding taxes can be a dense concept to work with but LatamReady is always implementing different tools in order to make things easier for you.