Oct 072015
The recent Supreme Court (SC) case on the timing of withholding tax on compensation income has caused quite a stir among corporate taxpayers.
While the case dealt with a deficiency withholding tax assessment on unsubstantiated business expenses (representation, travel and entertainment), the SC also ruled on the subject of withholding tax on accrued bonuses based on the taxpayer’s earlier claim that the amount in question refers to bonuses accrued during the years 1996 and 1997 but paid out in 1997 and 1998.