26 USC 3406, Backup Withholding. Withholding applies to individuals who have not provided the payee a tax identification number or failed to certify that they are is subject to backup withholding or with respect to whom the IRS has notified the payee that backup withholding applies. The rate of withholding tax is the fourth lowest rate of tax for individuals.
For example, U.S. rules provide that rentals that rise to the level of a trade or business are not subject to withholding taxes, but other rental income may be subject to 30% withholding tax. An election may be available under 26 USC 871(d) or an applicable tax treaty.
Penalties of up to 100% may be assessed against a withholding agent under 26 USC 6672 for intentional failure to withhold and remit. The penalty may be assessed against any person, including a corporate officer or employee, having custody or control of the funds.
"EUR-Lex - 31990L0435 - EN". Official Journal L 225 , 20/08/1990 P. 0006 - 0009; Finnish special edition: Chapter 9 Volume 2 P. 0025 ; Swedish special edition: Chapter 9 Volume 2 P. 0025.
These limits may vary by country and year. For 2009, the U.S. income limit on the retirement portion (6.2%) of social security tax was $106,800, versus $102,000 for 2008, and there was no limit on the medicare portion (1.45%) of the tax; see Publication 15, supra. Canadian wages subject to Canada Pension Plan were limited to $46,390 of the excess over $3,500 for 2009, at a tax rate of 4.95%; see Publication T4001, supra. UK National Insurance contributions are due for earnings above the Earnings Threshold (£110 weekly) up to a limit that varies depending on other coverage.
