Withholding Tax (WHT) Advisory
Withholding Tax (WHT) Advisory
Withholding tax (WHT) is a tax deducted at the source for specific types of payments made by residents of a country to non-resident individuals or entities. In the GCC, the WHT regime varies across countries. Notably, the UAE and Bahrain do not impose WHT, while Kuwait, Oman, Qatar, and Saudi Arabia apply WHT on certain payments to non-residents, as follows:
- Kuwait: A 5% withholding tax is applied to all payments made to beneficiaries. This amount is released upon obtaining a No Objection Certificate (NOC) from the Kuwait Tax Authority.
- Oman: A WHT of 10% is levied on gross payments.
- Qatar: A WHT of 5% applies on fees, royalties, interest, commissions, and other services.
- Saudi Arabia: A 15% WHT applies on royalties, commissions, attendance fees, and other services. A 5% rate applies on technical fees, interest, and dividends.
In the UAE, businesses can seek tax relief under Double Tax Treaties (DTT) with countries having an agreement with the UAE.
At PROTAX Corporate Services, our team of direct tax experts offers comprehensive WHT advisory services, including:
- Assessing the implications of country-specific WHT on proposed or existing transactions between GCC/ME entities and foreign or domestic businesses.
- Conducting WHT health checks and diagnostic reviews.
- Providing advice on the WHT impact of potential repatriation methods (e.g., interest, technical service fees, royalties) between related parties.
- Analyzing applicable WHT rates, potential exemptions, and exclusions under country-specific Corporate Income Tax (CIT) and WHT provisions, in conjunction with relevant Double Tax Treaties.
- Offering guidance on tax retention implications where applicable.
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