Act 195 Clause Samples

The 'Act 195' clause typically refers to a provision that incorporates or references Section 195 of a relevant statute, often relating to the withholding of tax on payments made to non-residents. In practice, this clause requires parties making certain payments, such as interest, royalties, or fees for technical services to foreign entities, to deduct and remit the appropriate tax to the government before completing the transaction. Its core function is to ensure compliance with tax laws by allocating the responsibility for tax withholding to the payer, thereby reducing the risk of tax evasion and ensuring proper collection of taxes on cross-border payments.