FAQ: Does WTI apply to the interest paid to a foreign person because the death benefit was not paid within the time provided for by the rules of the relevant fund?

Yes. The rules of a pension fund, provident fund, insurance fund or similar fund normally provide how a death benefit is calculated and by when it should be paid. Generally, these rules provide for a specific period, for example 60 days after death, within which the benefit, also known as the lumpsum benefit, should be paid. If the fund pays the death benefit after the period determined by the rules, the fund is legally liable to pay interest. This interest for the late payment of the death benefit is indeed subject to withholding tax on interest if it is paid to a foreign person as defined, unless any exemption applies.