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Tax on schedular payments
Employers must deduct tax on schedular payments (formerly withholding payments) from contractors performing activities outlined in schedule 4 of the Income Tax Act 2007. From 1 April 2010, there are legislative changes that impact contractors working in the horticulture and viticulture industries.
Employers do not need to deduct withholding tax from payments made to contractors who hold a current certificate of exemption from withholding tax.
There is a range of activities that are liable for tax on schedular payments. The tax rate differs according to the activity.