witholding

Withholding, commonly spelled withholding but sometimes misspelled as witholding, is the act of keeping back something that is due or expected. It has several uses in finance, law, and information management, and its meaning depends on the context.

In payroll and taxation, tax withholding refers to amounts that an employer or payer deducts from wages or payments and remits to tax authorities on behalf of the recipient. The withheld sums represent an estimate of the recipient’s tax liability and are later reconciled through a tax return. Withholding can also apply to other payments, such as nonresident income, dividends, or interest, and to obligations such as child support or court-ordered wage garnishments. Source withholding helps governments collect taxes efficiently and reduces the risk of underpayment by individuals.

In legal and information contexts, withholding denotes the deliberate non-disclosure of information or documents. This can be based on privilege, confidentiality, or privacy concerns, and is often subject to court rules governing discovery and privilege logs. Improper withholding may lead to sanctions or orders to disclose.

In procurement and construction, withholding refers to the retention or holdback of payment until contract terms are satisfied, typically used as a security against nonperformance.

Overall, withholding is a precautionary or regulatory action that shifts timing or risk by keeping assets, information, or payments in reserve until conditions are met or obligations are fulfilled. It is governed by statutes and contract terms, with practices varying by jurisdiction and sector.