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Tax Treaty Limits: Withholding Rules When Payee Exceeds Thresholds
August 6, 2025
Q. When a payee has reached their pay limits in a treaty, is the 30% tax retroactive to the whole funds? Example: Morocco independent personal services limit is 182 days max presence and $5000. If they get paid $3000 and then get paid $4000, do I need to go back and tax $7000 at 30%? OR, do I give treaty to $5000 and only tax $2000. Does the same logic apply to the max presence?
A.
(Answered by IOFM's third-party tax expert)
The tax treaty with Morocco doesn't clearly specify whether…
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