Tax deducted at source.
WHAT IT IS
An amount deducted from certain payments and remitted to the tax authority on the recipient's behalf.
WHY IT EXISTS
It collects tax at the point of payment rather than relying on later filing.
WHO DEDUCTS
The payer.
WHAT PAYMENTS IT TYPICALLY APPLIES TO
Professional and technical services Contracts and supplies Rent Commissions Dividends, interest and royalties
WHAT RATES DEPEND ON
The type of payment and whether the recipient is a company or an individual.
WHAT THE PAYER MUST DO
Deduct the correct amount Remit it within the prescribed period Issue a credit note or receipt to the recipient
WHY THE RECEIPT MATTERS
The recipient uses it to claim credit against their own liability.
WHAT HAPPENS WITHOUT IT
The recipient pays tax twice in effect.
WHAT RECIPIENTS SHOULD DO
Request the credit note, every time.
WHAT TO KEEP
Every credit note received, filed.
WHY
They are needed at filing, and reconstructing them later is difficult.
WHAT TO BE CAREFUL WITH
Failing to deduct, which makes the payer liable Deducting and not remitting
WHAT TO ESTABLISH
Which of your payments attract it, and at what rate.
WHAT TO VERIFY
Current rates and rules, which change with finance legislation.
