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Regulations on withholding tax.


By Dr Nizar Kochery/Doha

Question: We are a company incorporated under the commercial companies law, having two Qatari partners and one non-GCC foreign partner. We are doing business with foreign entities too. Please advise on the withholding tax regulations. HD, Doha Answer: According to Income Tax Law (No 21 of 2009), private companies established in Qatar shall pay corporate tax on their taxable profits at a flat rate of 10%. Taxable profits are ones derived from sources in Qatar and exclude profits attributable to Qatari and other Gulf Co-operation Council (GCC) nationals. With regard to withholding tax, to the extent that it is permissible to do any business in Qatar through a non-resident entity without a legal presence, any payments made to the non-resident entity in respect of activities performed wholly or partially in Qatar, are subject to withholding tax. This includes payments to non-resident entities without a permanent establishment in Qatar, and to non-resident entities with a permanent establishment but which have no commercial registration and tax card. The rate of withholding tax is 5% for royalties (which includes royalties for the use of intellectual property, and for the use of industrial, commercial or scientific equipment or information) and for managerial, technical and consultancy services. There is a 7% rate for all other services. NOC not needed for taking up a new job Q: I have an unlimited contract with my current company and I have completed two and half years. Now I want to change my job. Can I change without NOC? Or is it possible to change the job once my current employer cancels my visa after resignation? Can I come back on new visa from other company any time without NOC? If there is a ban, then for how many years I can't come back? Please advise. AP, Doha A: Now there is no requirement of a no-objection certificate from the previous employer for a former resident to take up a new job in Qatar. The entry, exit and residence law (Law No 21 of 2015) abolished the earlier two-year ban on expatriates who want to come back to the country on a new visa. If the employer cancels the residency permit or visa, he or she will be able to return to Qatar to take up employment immediately after being granted a new visa. An expatriate who has got a new contract to work in Qatar can come back even the next day. Execution case against company Q: As per management decision, I have issued a cheque as a guarantee to another company. Due to some issues, we could not pay the money on time. The company has filed a case against our company and judgment was issued without our knowledge. We filed an appeal against the judgment. Now we received a notice from the court stating that there is an execution case against the company. Can we stop the execution case with the filed appeal case? Please advise. SM, Doha A: As per Article 181 of the civil and commercial procedure law, filing an appeal against the judgment shall not stay the execution proceedings. The court hears the appeal and may order for stay of execution, whenever it is requested to do so. If the execution would cause unavoidable harm, the court may, when ordering a stay of execution, order payment of security or whatever it deems appropriate to guarantee the right of the respondent. Filing a petition for jail order Q: My colleague borrowed money from me and now he is not willing to pay back. The court has issued a judgment ordering him to pay the money with cost. But even after execution cases he is not paying the money. My friend advised me to file a petition for jail order. Could you please clarify on the application for jail order? Please help. NM, Doha A: According to Article 514 of the Civil and Commercial Procedure Code, if the judgment debtor abstains from the execution of judgment issued against him, the judgment creditor may request the imprisonment of the judgment debtor. The court may order the imprisonment of the judgment debtor if it is established that the judgment debtor is able to fulfil his obligation based on the issued order. Such imprisonment period shall not exceed three months * Please send your questions by e-mail to: [email protected]

LEGAL SYSTEM IN QATAR According to Article 155 of Civil and Commercial Procedure law, appeals against judgments shall be permissible only by the party against whom the judgment is issued. Appeal shall not be permissible by the party who accepts the judgment, by the party who is granted his remedies in full, unless the law provides otherwise. Decisions issued during the course of the proceedings which do not terminate the case, whether these decisions are conclusive or pertain to evidence or the course of the proceedings, shall only be appealable after the issuance of a judgment that terminates the whole proceedings, with the exception of provisional urgent decisions that suspend the proceedings and judgments subject to compulsory execution. As per Article 157, unless otherwise provided, the time limit for appealing against the judgment shall commence from the day following the date of its issuance. This time limit shall also commence from the date of notification of the losing party in cases where he fails to appear on all the dates fixed for hearing the claim and fails to submit his statement of defence, and if he did not appear or fail to submit the statement of defence in all sessions subsequent to resumption of the lawsuit after the suspension of the course of proceedings therein for any reason. The time limit shall commence from the date of notification of the judgment, if any reason for the interruption of the proceedings occur and should the judgment be issued without the involvement of the representative of a deceased, a party who lost his competency, or a party who lost his capacity. Notice of the judgment shall be addressed to the losing party in person, or to his original domicile. The time limit shall take effect against whoever was notified of the judgment. The notice of appeal shall be served upon the party personally, or to the original domicile. He may be served at the chosen domicile as specified in the notice of the judgment. If the respondent is the plaintiff who did not indicate in the proceedings the original domicile, he may be notified of the appeal in the chosen domicile as indicated in these proceedings. The right of appeal shall lapse in the event of non-compliance with the time limit for submitting appeals against judgments, and the court shall on its own accord decide accordingly. According to Article 160, the time limit for appeal shall be interrupted upon the death of the losing party, of his being incapacitated or by the lack of capacity of his attorney in the litigation. The time limit does not continue unless after the judgment is served to all the heirs without mentioning their names and capacities, or after it is served to the person who acts on behalf of the party who have lost his capacity or his ability to sue and be sued. If the appellant dies during the appeal proceedings, the losing party may submit an appeal and serve the summons on his heirs as a whole without stating their names and capacities at the last address where the deceased stayed. Whenever a case is filed and summons is served by the aforementioned procedure, the summons shall be served on all heirs with their names and capacities in person and at the address of each of them before a date is fixed for hearing the appeal or within the time limit specified by the court to this effect.

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Publication:Gulf Times (Doha, Qatar)
Geographic Code:7QATA
Date:Feb 24, 2018
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