Tax Terms

Withholding Tax

Definition

What is Withholding Tax?

Tax deducted at source from specified income payments before the recipient receives the balance.

Example in practice

A 10% withholding deduction on a $50,000 dividend leaves a $45,000 net payment.

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Tax that may apply to gains from disposing of qualifying assets.

A public authority responsible for administering and collecting taxes.

Structuring legitimate investment choices to reduce unnecessary tax while following applicable law.

The possibility of loss because broad market prices or rates move against an investment.

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