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Withholding Tax
Understanding withholding tax obligations
What is Withholding Tax?
Withholding Tax (WHT) is a tax deducted at source from payments made to suppliers, contractors, and service providers. It's an advance payment of income tax that helps ensure tax compliance and collection efficiency.
Who Deducts WHT?
Companies and Businesses: When making payments for goods and services, companies are required to deduct WHT at the applicable rate and remit it to the tax authority.
Government Agencies: Government entities also deduct WHT from payments to contractors and suppliers.
WHT Rates
Dividends10%
Interest10%
Royalties10%
Rent10%
Professional Services5%
Construction/Technical Services2.5%
Credit Against Final Tax
WHT deducted from your income can be used as a credit against your final income tax liability. If the WHT exceeds your final tax liability, you may be entitled to a refund after filing your annual tax return.