tax-withholding

Vocabulary Word

Definition

'Tax-withholding' is when a portion of your salary is taken out and set aside before you receive it. This money is used to pay your income taxes to the government so you don't owe a large sum later.

Examples in Different Contexts

For personal tax planning, understanding 'tax-withholding' can help individuals manage their tax liabilities throughout the year. A tax planner might advise, 'Adjusting your tax-withholding can prevent owing money when you file your tax return.'

Practice Scenarios

Business

Scenario:

Our company is growing, and so will our payroll. We need to ensure compliance with all applicable tax requirements.

Response:

Let's partner with an experienced payroll provider who can handle tax-withholding and other tax compliance needs.

Tech

Scenario:

Our payroll software is due for an upgrade. We need to consider the best options for handling various deductions.

Response:

We should consider a software that's user-friendly and provides an accurate tax-withholding feature.