Should the WTR01 form be completed even when no withholdings tax on royalties was withheld?
21 April 2015
Posted by: Author: SAIT Technical
Author: SAIT Technical
Q: Please advise
whether WTR01 forms should be completed for each and every royalty payment,
irrespective of whether withholding tax is withheld? According to the website
‘yes’, but according to the SARS officials there’s no need if no withholding
tax is withheld.
Should the completed WTRD forms be submitted to SARS? "No”,
according to the SARS officials, but according to the website below, it appears
to be yes.
A: Looking at the
WTR01 form on the below link, there is a note appearing on the top right hand
corner of the return, right under "WTR01”. The note states:
"A WTR01 return needs to be completed for each royalty
payment made to or for the benefit of the foreign person”
Where no tax was withheld or a lower rate was withheld because
of either the application of a DTA or an exemption, the WTR declaration (as
shown in the link below) has to be completed by the non-resident and sent to
the South African payor of the royalty.
The following note also
appears on the WTRD:
"In order to qualify for an exemption or a reduced rate
referred to above this declaration should be submitted to the person paying the
royalty to or for the benefit of the foreign person within the period required
by the former (provided it is before the date of payment of the royalty) -
failure to do so will result in the full rate of withholding tax on royalties
The declaration serves as documentary proof of the validity
of either a lower tax rate being applied to the royalty payment or an exemption
of the royalty.
My opinion would be to submit the WTR01 even if there was no
withholding. The form itself requires one to specify the applicable rate (i.e.
as per the DTA or 0% in the case of the exemption). I believe this field would
not be on the form if one simply did not have to submit the return where an
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