Withholding Tax Calculator
When you pay a supplier for services, rent or royalties, sometimes you have to withhold part of the payment and transfer it to the Tax Authority. Pick a payment type and amount and instantly get the withholding amount and the net to the supplier.
* The withholding is calculated on the amount before VAT. VAT is paid in full to the supplier; only the tax portion is withheld and transferred to the Tax Authority, and reported on Form 856. Reduced rates require a valid certificate from the assessing officer. Consult an accountant.
Common withholding tax rates
- •Services (individual/dealer): 20% · Services (company): 25% (Section 164)
- •Business rent without a certificate: 35% · Royalties: 23% (Section 170)
- •Construction contractor: 20% · Insurance agent commissions: 20% (Section 170)
- •A supplier with a valid certificate from the assessing officer is entitled to a reduced rate or a full exemption.
Frequently asked questions
What is withholding tax at source?
A portion of the payment to a supplier that the payer withholds and transfers directly to the Tax Authority. The supplier receives the net, and the withheld amount is credited to them as an advance toward their annual tax.
What is the rate on services?
20% for an individual/dealer, 25% for a company. Rent without a certificate — 35%, royalties — 23%, construction contractor — 20%.
Is tax withheld from the VAT?
No. The withholding is calculated on the amount before VAT only. VAT is paid in full to the supplier.
Want the withholding calculated and reported for you?
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