• Introduction, Responsibility of Payer
  
• Royalty S109, Interest S109C
  
• Special Classes of Income, Contract Payments
  
• Other Gains or Profits, Re-grossing, Residence Status of the Payee

Income Tax is a direct tax, and in certain circumstances the payer has the responsibility to withhold the tax (ITA 1967) when making payment to the non-residents (foreign workers/employees). Failure to do so, the payer will suffer penalties and be prohibited from claiming a tax deduction against his own income for the payment to the foreign party.

The scope of these withholding taxes is ever-evolving – both at the domestic level and international level. Ignorance is no excuse, and it is imperative for any person managing the day-to-day payments and accounts of a business to understand their obligations under the withholding tax provisions, and the cost of non-compliance.

1. Understanding the payments for which the withholding taxes obligations should be considered.
   
2. Understanding the withholding taxes obligation that arises from reimbursements and disbursements in respect of services rendered by non- residents.
   
3. Avoiding penalties that may arise if deductions are wrongfully claimed in respect of payments for which the withholding taxes have not been remitted to the authority.