By Dr Nizar Kochery/Doha
Question: We are a company incorporated under the commercial companies law, having two Qatari partners and one non-GCC foreign partner. We are doing business with foreign entities too. Please advise on the withholding tax regulations.
Answer: According to Income Tax Law (No 21 of 2009), private companies established in Qatar shall pay corporate tax on their taxable profits at a flat rate of 10%. Taxable profits are ones derived from sources in Qatar and exclude profits attributable to Qatari and other Gulf Co-operation Council (GCC) nationals.
With regard to withholding tax, to the extent that it is permissible to do any business in Qatar through a non-resident entity without a legal presence, any payments made to the non-resident entity in respect of activities performed wholly or partially in Qatar, are subject to withholding tax. This includes payments to non-resident entities without a permanent establishment in Qatar, and to non-resident entities with a permanent establishment but which have no commercial registration and tax card. The rate of withholding tax is 5% for royalties (which includes royalties for the use of intellectual property, and for the use of industrial, commercial or scientific equipment or information) and for managerial, technical and consultancy services. There is a 7% rate for all other services.
NOC not needed for taking up a new job
Q: I have an unlimited contract with my current company and I have completed two and half years. Now I want to change my job. Can I change without NOC? Or is it possible to change the job once my current employer cancels my visa after resignation? Can I come back on new visa from other company any time without NOC? If there is a ban, then for how many years I can’t come back? Please advise.
A: Now there is no requirement of a no-objection certificate from the previous employer for a former resident to take up a new job in Qatar. The entry, exit and residence law (Law No 21 of 2015) abolished the earlier two-year ban on expatriates who want to come back to the country on a new visa. If the employer cancels the residency permit or visa, he or she will be able to return to Qatar to take up employment immediately after being granted a new visa. An expatriate who has got a new contract to work in Qatar can come back even the next day.
Execution case against company
Q: As per management decision, I have issued a cheque as a guarantee to another company. Due to some issues, we could not pay the money on time. The company has filed a case against our company and judgment was issued without our knowledge. We filed an appeal against the judgment. Now we received a notice from the court stating that there is an execution case against the company. Can we stop the execution case with the filed appeal case? Please advise.
A: As per Article 181 of the civil and commercial procedure law, filing an appeal against the judgment shall not stay the execution proceedings. The court hears the appeal and may order for stay of execution, whenever it is requested to do so. If the execution would cause unavoidable harm, the court may, when ordering a stay of execution, order payment of security or whatever it deems appropriate to guarantee the right of the respondent.
Filing a petition for jail order
Q: My colleague borrowed money from me and now he is not willing to pay back. The court has issued a judgment ordering him to pay the money with cost. But even after execution cases he is not paying the money. My friend advised me to file a petition for jail order. Could you please clarify on the application for jail order? Please help.
A: According to Article 514 of the Civil and Commercial Procedure Code, if the judgment debtor abstains from the execution of judgment issued against him, the judgment creditor may request the imprisonment of the judgment debtor. The court may order the imprisonment of the judgment debtor if it is established that the judgment debtor is able to fulfil his obligation based on the issued order. Such imprisonment period shall not exceed three months
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