Section 116 Withholding Tax Sample Clauses
Section 116 Withholding Tax is a contractual provision that addresses the obligation to withhold taxes on certain payments, typically those made to non-resident parties. In practice, this clause requires the paying party to deduct and remit a specified percentage of the payment to tax authorities, in accordance with applicable tax laws, before transferring the net amount to the recipient. Its core function is to ensure compliance with tax regulations and to allocate the responsibility for tax withholding, thereby reducing the risk of penalties or disputes related to tax liabilities.
Section 116 Withholding Tax. Notwithstanding anything else --------------------------- contained in this Agreement, if ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ fails to deliver at or before the Closing Date a certificate of compliance issued by Revenue Canada pursuant to section 116 of the Income Tax Act (Canada) (a "Certificate of Compliance") in respect of the Shares to Subco in an amount not less than the Purchase Price payable to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ by Subco hereunder, Subco shall be entitled to withhold from the Purchase Price payable to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ hereunder, an aggregate amount equal to 33 1/3% (or such greater or lesser percentage as may be required under the Income Tax Act (Canada) at the applicable time) of the Purchase Price payable to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ hereunder by Subco. Subco, shall remit such withheld amount to Revenue Canada not later than 30 days following the end of the month in which the Closing occurs, on account of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ liability for tax pursuant to section 116 of the Income Tax Act (Canada). Notwithstanding the foregoing, if ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ delivers to Subco, prior to the date funds are to be remitted to Revenue Canada hereunder, a Certificate of Compliance in an amount which is not less than the Purchase Price payable by Subco to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ hereunder, Subco, shall forthwith pay such withheld amount to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇.