What is the withholding rate on equipment and materials supply?

Procurement and commercial supply contracts are generally subject to a 1.5% to 3.0% withholding deduction.

How are withheld tax retentions reconciled?

Retained amounts are credited against final corporate income tax assessments upon receiving official tax clearance from the GCT.

IraqUpdated for 2026Taxes

Iraq Contract Withholding Tax & Retention Calculator 2026

Calculate Iraqi statutory withholding tax and advance tax retentions on construction contracts, supply procurements, and consulting services in 2026.

Income Tax & Brackets Business & Companies Property Taxes & Fees

Calculated Result

Withheld Tax Advance Amount

3,300,000IQD

Calculator Inputs

Invoice / Progress Payment Amount

IQD

Quick select:

Contract / Procurement Nature

Withheld Tax Advance Amount

3,300,000IQD

Net Disbursable Amount to Contractor

96,700,000 IQD

Applied Withholding Rate

3.3%

Withheld amounts are remitted directly to the GCT and credited towards the company's annual corporate tax assessment.

Invoice vs Tax Retention Breakdown

Net Transfer to Contractor

96,700,000 IQD(97%)

Statutory Retained Tax

3,300,000 IQD(3%)

Calculated in accordance with withholding tax directives issued by the Iraqi Ministry of Finance and General Commission for Taxes (GCT).

This calculator is a mathematical model for general financial estimation, planning, and educational guidance. Results depend on your inputs and standard formulas, and do not constitute binding financial, tax, or investment advice. Always consult a qualified professional before making financial decisions.

Official Statute: تعليمات الاستقطاع المباشر والتحاسب الضريبي على عقود المقاولات والتجهيز والخدمات الصادرة عن الهيئة العامة للضرائب العراقيةLast Verified: 2026-09-04

Calculation Methodology

Disbursing authorities deduct mandatory tax retentions: 1.5% for local supply, 3.3% for contracting/construction, and 5%-7% for professional/foreign consulting services.

Frequently Asked Questions

A statutory withholding rate of 3.3% is withheld from each progress payment made to contractors.

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Iraq

Iraq Contract Withholding Tax & Retention Calculator 2026

Calculator Inputs

Invoice vs Tax Retention Breakdown

Calculation Methodology

Frequently Asked Questions

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