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Paying Contractors

Withholding Tax

To deduct withholding tax from a contractor select a withholding tax rate from the tax code dialog. These codes deduct a percentage tax rate without the addition of earner premium.

GST Payment

To add GST to the contractors wages, add a non taxable allowance called "GST 12.5%" or similar. Set the calculation method of this allowance to " Percentage Of Gross" and enter the rate as 12.5

 

Then by calculating a gross pay in whatever manner you choose, the withholding tax and GST are automatically calculated.

If you now load a bank account to the employee, you can even direct credit their payments automatically.

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Updated: 31st March 2010
Published: 5th April 1999
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