Qatari companies paying foreign contractors: the 5 percent withholding tax and how to file

A Doha facilities management company hires a Dubai engineering firm to commission building systems on site in Lusail. The invoice is QAR 420,000. The Dubai firm has no permanent establishment in Qatar. Because the work was carried out in Qatar, the Doha company withholds tax, remits it and files the return through Dhareeba before the 16th of next month.

When withholding applies

Qatar's income tax law requires withholding on certain payments to non-residents that have no permanent establishment in Qatar, when the income comes from activities in Qatar:

• 5 percent on royalties and technical fees,
• 7 percent on interest, commissions, brokerage fees, director's fees, attendance fees and payments for other services carried out wholly or partly in Qatar.

Services performed entirely outside Qatar are generally outside the regime. A design study carried out in London and delivered by email is treated differently from engineers working on site in Doha. Check the facts for each contract.

Filing

The payer withholds the tax, remits it and files the withholding return through the General Tax Authority's Dhareeba portal by the 16th of the month following payment. The payer is liable for tax it should have withheld but did not.

Treaties

Qatar's double taxation agreements can reduce or eliminate withholding on some payments. Obtain the provider's certificate of tax residence and follow the GTA's procedure.

Contracts

Foreign providers often price net of Qatari tax. Agree whether the price is gross or net before signing, so the 5 or 7 percent does not become a dispute.

Paying into Qatar: the local rail

Source: Qatar Central Bank: Fawran. Checked when this guide was last updated; the scheme's own page has the current figures.

Where Rivet fits

Rivet does not file Qatari withholding tax. A Rivet business account accepts registered companies after verification, including Qatari companies, subject to local rules, and pays providers in 120+ countries with each payment matched to its invoice. Rivet is not a bank; regulated partner institutions hold the funds.