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Key tasks: Manage pay-when-paid projects

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Important

This content is archived and is not being updated. For the latest documentation, see Microsoft Dynamics 365 product documentation. For the latest release plans, see Dynamics 365 and Microsoft Power Platform release plans.

Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012

When you approve a vendor as a subcontractor for a project, you can withhold payment to the vendor or subcontractor until you have been paid by your customer for the project. In Microsoft Dynamics AX, you set up pay-when-paid (PWP) terms when you set up a purchase order with the vendor.

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Set up PWP terms for the project

Create a purchase order with PWP terms

Update customer payment information and pay the vendor

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About pay-when-paid projects

Set up PWP terms for the project

Set up the PWP threshold percentage for the project. The percentage that you enter sets the minimum amount that the customer must pay on the project before you pay the vendor. The threshold amount is automatically calculated on the customer invoices that you create for the project.

  1. Click Project management and accounting > Common > Projects > All projects. Open the project from the project list page.

  2. On the Vendor agreements FastTab, click Add line.

  3. In the Account code field, select from the following options:

    • Table – The PWP terms apply to a single vendor.

    • Group – The PWP terms apply to all vendors in a vendor group.

    • All – The PWP terms apply to all vendors.

  4. In the Vendor/Vendor group field, select the vendor or vendor group to which the PWP terms apply. If you selected All in the previous step, this field is unavailable.

  5. If the project also has vendor retention terms set up for the vendor, in the Vendor retention terms field, select the rule ID for the retention terms. For more information about vendor retention terms, see About vendor payment retention for projects.

  6. In the PWP threshold percentage field, enter the threshold percentage for the project. The percentage that you enter for the project sets the minimum amount that you must be paid by the customer before you pay the vendor.

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Create a purchase order with PWP terms

Create a purchase order for the vendor. When you post an invoice from the vendor, and the vendor is subject to PWP terms, the PWP terms are displayed on the purchase order lines.

  1. Click Procurement and sourcing > Common > Purchase orders > All purchase orders. On the Action Pane, on the Purchase order tab, in the New group, click Purchase order. In the Create purchase order form, enter the required information, and then click OK. Alternatively, open a purchase order in the All purchase orders list.

  2. In the Purchase order form, on the Purchase order lines FastTab, review the details of the purchase order line for the vendor. The Pay when paid check box is automatically selected, and the PWP threshold percentage value is automatically copied to this form from the PWP threshold percentage field in the Projects form.

  3. If you do not want to apply PWP terms to the vendor for this purchase order line, you can clear the Pay when paid check box. If you do clear the check box, the PWP threshold percentage field for this purchase order line is set to 0 (zero).

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Update customer payment information and pay the vendor

When the vendor finishes work on the project and sends you an invoice, review the project status and customer invoices to see whether the PWP terms were met for the project. If the PWP terms for the vendor were met, you can determine which lines on the vendor invoice to pay, based on the customer payments for the project.

If you decide to pay the vendor even if the PWP terms were not met, you can override the PWP terms in the Vendor invoices with retention form.

Note

In Microsoft Dynamics AX 2012 Feature Pack and Microsoft Dynamics AX 2012, this form was named Vendor invoice.

  1. Click Project management and accounting > Inquiries > Retention > Vendor invoices with pay when paid. In the Vendor invoices with retention form, enter values in the Filter section to find the vendor invoice to review, and then click Search.

  2. On the Vendor invoice lines FastTab, review the lines in the vendor invoice for the project, and select the line for which to make changes.

  3. If the PWP conditions are met for the invoice line, click Release vendor payment. This clears the Pay when paid check box, and the status of the Ready for payment field changes to Yes.

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Find form help

Projects (form)

Purchase order (form)

Vendor invoices with pay when paid (form)

Key tasks: Manage vendor payment retention for projects