Retention is an amount held back from a subcontractor's progress claim until the work is finished or defects are fixed.
Before you start
- Retention set on the PO header or item
- Retention customizing in Logistics Invoice Verification
The S/4HANA way
Where to find it: Purchase order: Retention; Enter Invoice (MIRO) or Manage Supplier Invoices (F0859)
- On the PO set Retention as a percentage at header or item level.
- When you enter the invoice SAP proposes the retention amount. You can change the percentage and amount.
- Enter or confirm the due date for the retention payment.
- Post. SAP makes a retention document with the supplier line and special G/L items (special G/L indicator H by default).
Limits in S/4HANA
- You cannot use retention together with prepayment of an invoice.
- Different tax codes are not possible in a multiple account assignment with retention.
- Planned delivery costs are not in the retention calculation.
- In automated runs such as ERS the due date must be set in Customizing.
Example in S/4HANA
Example Concrete Pty Ltd sends a supplier invoice for $20,000.00. The PO has retention of 5% at item level. Amounts are before GST to keep the example simple.
| Line | Amount | Tagged to |
|---|---|---|
| Invoice amount | $20,000.00 | Supplier invoice against the PO |
| Retention held at 5% | $1,000.00 | Retention document, special G/L indicator H, own due date |
| Amount due now | $19,000.00 | Supplier line less retention |
SAP proposes the 1,000.00 retention when you enter the invoice. You can change the percentage and amount, and you set the due date for the retention payment.
Common mistakes
- Using retention on an invoice that also has a prepayment.
- Mixing tax codes in a multiple account assignment that has retention.
More help
- How to record retention on a subcontractor supplier invoice in IFS Cloud
- How to record retention on a subcontractor purchase invoice in Sage X3
- How to match a supplier invoice to a purchase order in S/4HANA
- How to job cost supplier invoice records in S/4HANA
- How to report contractor payments for TPAR from S/4HANA
- How to record retention on a subcontractor bill (any system)
- All S/4HANA how-to guides
- Pulsify setup guides
Sources
Last checked 2026-10-19. Confidence: confirmed.
Common questions
Where do I set retention in SAP?
On the PO, as a percentage at header or item level. When you enter the invoice SAP proposes the retention amount, and you can change the percentage and amount. Enter or confirm the due date for the retention payment.
What does SAP post for retention?
A retention document with the supplier line and special G/L items. The special G/L indicator is H by default.
What does retention not work with?
Prepayment of an invoice and different tax codes in a multiple account assignment. Planned delivery costs are not in the calculation. In automated runs such as ERS, set the due date in Customizing.
Does Pulsify track retention?
No. Track retention in your accounting system or a schedule.
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