Withholding on International Payments
Any department doing business with a non-U.S. entity or citizen should contact the Tax Department or UCF Global prior to entering into any agreements. These agreements should be reviewed for any potential tax withholding obligations, as well as for any immigration and foreign asset control issues. This includes payments to be made via UCF PCard.
Internal Revenue Code §1441 generally imposes the liability to withhold taxes on all payments made to foreign entities, including individuals. As always, in tax compliance, there are exceptions to this rule. These exceptions to withholding are complicated and are required to be determined by UCF Global. Exceptions may come from treaties, the location of services provided, or the nature of the payments being made. Annually, payments to non-U.S. citizens are reported to the IRS on Forms 1042-S and 1042.
Disclaimer: The University of Central Florida and its related organizations do not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction.