Dividend Withholding Tax (DWT)

What is Dividend Withholding Tax?

A tax deducted from dividends before they’re paid to shareholders.

Think of it like this…

When your company pays dividends, it must deduct a set percentage for SARS before sending the rest to shareholders.

Why does it matter?

  • Usually 20% in South Africa (unless reduced by treaty)
  • Companies must deduct and pay it over to SARS
  • Shareholders receive the net amount only

Best practice

Ensure you have shareholders’ tax residency details to apply the correct rate.

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