Income Tax Withholding
/ˈɪnkʌm tæks wɪðˈhoʊldɪŋ/
Definitions
- (n.) The legal obligation of employers to deduct a portion of an employee’s earnings for payment to the government as prepayment of income tax liability.
The employer must comply with income tax withholding laws to avoid penalties.
Forms
- income tax withholding
Related terms
See also
Commentary
Income tax withholding is a withholding tax mechanism primarily applied to wages and salaries, ensuring tax collection at the source to improve government revenue compliance.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.