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ard.gov.af Wage Withholding Tax : Afghanistan Revenue Department

Organization : Afghanistan Revenue Department
Facility : Wage Withholding Tax
Country : Afghanistan
Website : http://ard.gov.af/#home
Details Here : https://www.statusin.org/uploads/41378-Wage-Withholding.pdf

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ARD Wage Withholding Tax

The Income Tax Law 2009 has changed some of the applications of the wage withholding tax. This guide will explain those changes and help you in complying with the law.

Related : Afghanistan Revenue Department Business Receipts Tax BRT : www.statusin.org/7856.html

Who Must Withhold

Legal persons and natural persons (individuals) with two or more employees during any month of the tax year are required to withhold tax from employees whose income exceeds the threshold, discussed later (Article 58 Income Tax Law).

Legal persons include partnerships, corporations, limited liability companies, organizations, agencies, ministries and other national or local government agencies and departments, enterprises of the State and municipalities, and charitable institutions.

What Payments Are Subject To Withholding

Payments to employees in the form of salaries and wages for work provided are subject to withholding. Salaries and wages include : regular pay for services, overtime pay, cash allowances provided by the employer to the employee (including, but not limited to, food allowances and transportation allowances), and non-cash payments for services.

For more detailed information regarding which payments are subject to withholding, see Public Ruling 1384/6 posted on the Ministry of Finance website or on the Afghanistan Revenue Department website

Who Is Subject To Withholding

All resident and non-resident employees working in Afghanistan whose salaries and wages exceed the tax threshold of AFN 5000 (or equivalent in foreign currency) per month or equivalent pro-rated amounts for those paid on alternate payroll periods.

Non-resident employees are exempt from withholding if their home country provides the same exemption to residents of Afghanistan.

Resident and non-resident employees of foreign governments and international organizations are subject to tax based on existing agreements, treaties or protocols with the State.

Who is a resident? Who is a non-resident?

According to the Income Tax Law, a natural person is a resident of Afghanistan (Article 2) for the tax year if :
1) The person has his or her principal home in Afghanistan at any time during the year; or
2) The person is present in Afghanistan for a period of 183 days in the tax year; or

3) The person is an employee or an official of the Government of Afghanistan posted abroad at any time during the tax year. Non-residents are those people who do not meet the above requirements. All Afghan-source income is taxable for non-residents.

Afghan-source income is deļ¬ned as any income directly produced in Afghanistan or paid for services provided in Afghanistan regardless of the period over which those services were provided.

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