What happens if withholding tax on a cross-border share sale is paid late or calculated incorrectly?

Withholding tax on a share sale to or from a non-resident must be deposited by the 5th of the month following deduction. Missing that deadline attracts interest for the delay, and can also trigger a penalty for late deposit. An incorrect calculation — using the wrong rate, missing a treaty benefit the seller was entitled to, or misjudging the holding period — creates a separate problem: either the buyer under-withholds and remains exposed to a shortfall demand, or the seller receives less than they were entitled to and has a harder time reconciling their own tax credit.

Because the withholding calculation depends on valuation, holding period, and treaty facts that are usually confirmed during the earlier stages of the transaction, getting this right is really a function of not rushing the valuation and documentation stage to get to signing faster.