Payment Withholding
/ˈpeɪmənt wɪðˈhoʊldɪŋ/
Definitions
- (n.) The act of retaining a portion of payment owed to a party, typically by law, contract, or agreement, until certain conditions or obligations are met.
The contractor faced payment withholding until the project was completed to standards.
- (n.) A legal mechanism used for ensuring compliance with tax obligations by employers or payers withholding tax amounts from payments made to employees or contractors.
The company applied payment withholding on employee wages to cover income tax liabilities.
Forms
- payment withholding
Related terms
See also
Commentary
Payment withholding can serve both as a contractual security measure and a statutory tax compliance tool; clarity in contract drafting is essential to specify conditions and extent of withholding.
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.