Construction
Withholding Tax Deducted from Subcontractor
Deducting withholding tax from a domestic subcontractor's payment as required by Jordanian tax law.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Accounts Payable (Subcontractor) | Liability (-) | 100,000.00 | - |
| Withholding Tax Payable (ISTD) | Liability (+) | - | 5,000.00 |
| Cash in Bank | Asset (-) | - | 95,000.00 |
💡 Accountant's Note
In Jordan, companies must withhold 5% tax from payments to certain domestic contractors and subcontractors and remit it to the ISTD. The subcontractor receives the net amount.
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