Witholding TAX 2022 – Meaning, Examples & How to calculate

Do you wish to know what about Withholding Tax? or perhaps you are wondering how withholding Tax is being calculated? then you are in luck!

Most nations have withholding tax as one of the taxes its residents and locals are expected to pay. In the USA, even non-residents are expected to pay to withhold Tax on their economically earned salary especially if the USA serves as their major source of earnings.

Withholding tax are also taken from other sources of income as well such as interest and dividends. On these pages, we will be examining the Tax withholding and how it is calculated, what is the meaning of withholding tax? what percentage is the tax in Nigeria? and the most frequently asked, “Do you pay tax on withholding?”

Withholding Tax 2022

 Withholding Tax in Nigeria.

The Pay- as- you -earn tax system or Tax Withholding is deducted at the source of the income before the net earned income is given to the employees by the employers

It is calculated by the employer using certain percentage within the range of 5-10%  to know how much percentage of the gross income salary is to be withheld as Tax Withholding.

The amount withheld is now given to the Internal Revenue service,IRS. The Withholding tax can be found on the W2 form or the Wage and Tax statement form will is sent annually to employee by their employers.

What are the examples of withholding taxes?

Withholding tax exists in different forms in different countries. In the US, examples of Withholding tax include federal income tax, social security, medicare taxes, state income tax, etc.

Who is responsible for Withholding tax?

The Withholding tax is gotten by the Internal Revenue Service,IRS on behalf of the government from employers of labor.

When should withholding taxes be paid?

All tax withholding should be remitted within 3 days after close of the quarterly month period. This is however for taxes above $2000.

How much tax should you have Withheld?

This is a frequently asked question for several employees. The question of ” how much” should be levied as withholding tax is dependent on how much you earn annually and your filling status. Your Filing status defines the category of tax you are liable to pay.

I know it has been an exciting journey this far. So need more information on Witholding TAX, you can kindly drop your comment below and bookmark the page.

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