Withholding Tax for small taxpayers

Withholding Tax (WHT) for small taxpayers

---

Taxpayers are exempted from having to pay withholding tax unless they are dealing with movable and immovable properties, so read more detail about withholding tax : all withholding taxes.

Withholding taxes on movable and immovable properties are subject to withholding tax at 10%. Please read more about withholding tax on these properties: WHT on properties rental

Example 1

ABC is small taxpayer, and ABC has the following transactions for expenses during December 2018:

• – Salary expense $500 ( Mr.A’ s salary of $250 and Mr.B’s salary of $250)
• -Office rental of $1000
• -Car rental of $300
• -Computer repair of $20, but this service is performed by Mr.C, individual.
• -Business consulting of $110 (included VAT) performed by XYZ Company.

Required

Calculate any withholding taxes that ABC will pay to tax authority.

Answer

1.Withholding tax on immovable property

Office Rental = $1,000

WHT on office rental = $1,000 x 10%=$100

2.Withholding tax on movable property

Car rental =$300

WHT on car rental = $300 x 10%=$30

3.Withholding tax on service

For small taxpayers, withholding on service is exemption, so computer repair ( $20) or business consulting ($110) is not subject to withholding tax.