UPDATE: New 3% Withholding Tax on Specified Services | KPMG | JM

UPDATE: New 3% Withholding Tax on Specified Services

UPDATE: New 3% Withholding Tax on Specified Services

An update on recent developments with the 3% Withholding Tax on Specified Services regime

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Withholding tax
  • Initial implementation phase commences September 1, 2015.
  • Specified large taxpayers are now required to withhold tax at 3% on fees of $50,000 or more paid to a variety of service providers including accountants, lawyers, engineers, caterers, entertainers, janitors, as well as those providing rental of motor vehicles/equipment and those providing transportation, haulage or tours. 
  • Tax compliant service providers are exempt from the withholding tax once issued with an Exemption Certificate.  
  • Penalty for failure to withhold can be up to 50% of the tax due.
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The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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