withholding tax

American  

noun

withholding taxes plural

1. that part of an employee's tax liability withheld by the employer from wages or salary and paid directly to the government.

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withholding tax British  

noun

1. tax deducted at source from income, esp from dividends, paid to nonresidents of a country, which may be reclaimed if a double-taxation agreement exists between the country in which the income is paid and the country of residence of the recipient

2. a portion of an employee's tax liability paid directly to the government by the employer

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withholding tax Cultural  

1. The tax withheld (or deducted) directly from one's paycheck.

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Other Word Forms

Derived Forms

• unwithholding
  adjective

Inflected Forms

Nouns

• withholding taxes
  plural

Etymology

Origin of withholding tax

First recorded in 1940–45

Example Sentences

Andrew Keshner and Victor Retlaitis explained the opportunities and risks of reducing your withholding tax.

From MarketWatch • Nov. 21, 2025

The schemes typically involve the rapid sale of large volumes of shares from one investor to another immediately before the payment of a dividend, enabling duplicated claims of the withholding tax.

From BBC • Dec. 12, 2024

In several states, including North Carolina, Ohio, and New York, public university systems refer patients to other state agencies for legal action or withholding tax refunds.

From Salon • Dec. 22, 2022

Its impact is diminished because awards are subject to a federal withholding tax, meaning that 37 percent of the dollars appropriated to this program go right back to the U.S.

From Washington Post • Dec. 20, 2022

The firm has been in a long-running tussle with the Dutch authorities over the country’s 15% dividend withholding tax on some of its shares, making them less attractive for international investors.

From Reuters • Jan. 21, 2022