(1) Subject to regulation 5, where an employer makes a qualifying cash payment to an employee during a year of assessment, the employer shall withhold tax from the payment.

(2) The employer shall calculate the amount of tax to be withheld under subparagraph (1) by applying the following formula:

AxB/C   where

A is the amount of the payment;

B is the employment tax liability of the employee for the year estimated under sub-regulation  (3) less tax withheld under this sub-regulation by the employer from prior qualifying cash payments made by the employer to the employee during the year of assessment; and

C is the total of the payment referred to in A and qualifying cash payments still to be made by the employer to the employee during the year of assessment as estimated under sub-regulation (3).

(3) For purposes of a calculation under sub-regulation (2), the employer may at the time of making a qualifying cash payment to an employee,

(a) make a reasonable estimate of

(i) tax liability of the employee from employment for the year of assessment during which the payment is made; and

(ii) the amount of qualifying cash payments yet to be made by the employer to the employee during the year of assessment; or

(b) consider whether or not an estimate made under paragraph (a) is still accurate and, if not, make a new estimate under that paragraph.

(4) In making an estimate under paragraph (a) of sub-regulation (3), an employer shall not take into account

(a) any tax reliefs of the employee, unless the employee has provided the employer with a tax reliefs card in accordance with sub-regulation (2) of regulation 10 prior to the estimate; and

(b) any contribution made under section 112 of the National Pension Act, 2008 (Act 766), except where the employee submits evidence of a contractual arrangement to the employer prior to the making of the estimate.

(5) An employee may, in writing, apply to the Commissioner-General for an adjustment of the amount to be withheld under sub-regulation (1), where the qualifying employment income of that employee includes an amount that does not have a source in the country.

(6) The Commissioner-General may, upon receipt of an application under sub-regulation (5), adjust the amount to be withheld under sub-regulation (1).