When Withholding Tax (WHT) is applied to a deal, you may notice that the inclusive Booking Fee changes — even when the Booking Fee percentage, Gross Fee and costs remain exactly the same.
This happens because ABOSS calculates the inclusive Booking Fee differently when WHT is applied.
Why does the inclusive Booking Fee change?
When WHT is applied, ABOSS deducts applicable costs and the Booking Fee from the Gross Fee before calculating WHT. This keeps the amount that is subject to WHT as low as possible.
Because of this:
Without WHT, applicable costs are deducted first. The Booking Fee percentage is then calculated over the remaining fee.
With WHT, the Booking Fee percentage is calculated over the Gross Fee. The applicable costs and the full Booking Fee are then deducted before WHT is calculated.
Example without WHT
Let's use the following deal:
Gross Fee: €1,500
Costs: €300
Inclusive Booking Fee: 10%
First, the costs are deducted:
€1,500 − €300 = €1,200
The 10% Booking Fee is calculated over the remaining €1,200:
€1,200 × 10% = €120 Booking Fee
The Artist Statement therefore shows a Booking Fee of €120.
Example with WHT
Now let's use exactly the same deal, but apply 15% WHT:
Gross Fee: €1,500
Costs: €300
Inclusive Booking Fee: 10%
WHT: 15%
With WHT applied, the Booking Fee is calculated over the full Gross Fee:
€1,500 × 10% = €150 Booking Fee
The applicable costs and Booking Fee are then deducted to determine the amount subject to WHT:
€1,500 − €300 − €150 = €1,050
WHT is calculated over this amount:
€1,050 × 15% = €157.50 WHT
Comparing the two
Without WHT:
Inclusive Booking Fee: €120
With WHT:
Inclusive Booking Fee: €150
WHT: €157.50
The Inclusive Booking Fee is therefore higher when WHT is applied. By calculating the Booking Fee over the Gross Fee, the full €150 Booking Fee can be deducted before WHT is calculated. This reduces the amount that is subject to WHT.