ISR and ISV withholding in Honduras: how to withhold, record and pay

By the PymesPros team · Updated on November 3, 2026

Related free calculator: Withholding and professional fees

When you have to withhold

The duty to withhold depends on two things: whether the SAR has designated your company as a withholding agent, and what kind of payment it is (for example fees, rent or services). If your company is not designated, it does not withhold.

The rates, the amounts above which you withhold and the deadlines are set by the SAR and change over time, so they are not written here. Confirm them on the SAR portal or with your accountant before applying them.

You can withhold ISR (income tax) and also ISV (sales tax). Each goes to its own withholding payable account, so that what you file on each form is not mixed.

How the withholding is recorded

There is a single rule: the expense or purchase is recorded for the full amount (the tax base), and what you withhold is not subtracted from the expense, it is credited to a liability.

If the supplier invoice was already recorded in Purchases, its journal entry already took the expense. In that case the withholding entry only settles the debt: Accounts payable on the debit side, and Bank and Withholding payable on the credit side.

The amount withheld can never be larger than the base: you cannot withhold more than you paid. A well-built system prevents it instead of letting the entry balance but make no sense.

The withholding certificate

1. Issue it when you pay, with the base, the tax withheld and the details of the recipient.
2. Give a copy to the person you withheld from: they need it to claim the withheld amount in their own return.
3. Keep your copy with the invoice or receipt that triggered it.
4. Number it in order, with no gaps and no repeated numbers, like any other tax document.

Filing and paying what you withheld

What you withhold is declared and paid to the SAR within the deadlines it sets. Meanwhile it sits in the "withholding payable" liability. When you pay, that account is settled against the bank.

A good closing habit is to compare the balance of the withholding payable account against what you filed: if they do not match, a certificate is missing, one was recorded twice or you filed too little.

When someone withholds from you

If a customer withholds from you, the amount does not reduce your income or your company’s tax expense: it is an advance payment of tax, a way of paying. You use it as a credit when you file. That is why you need to keep every certificate they give you.

Common mistakes

• Recording only the net amount paid as the expense, and losing the base and the tax withheld.
• Not handing over the certificate, so the supplier cannot claim what was withheld.
• Withholding without being designated, or not withholding when required.
• Not reconciling the withholding payable account against the returns.
• Paying or filing late for not checking the SAR calendar.

How PymesPros helps

In PymesPros the withholding certificate generates its own double-entry journal entry: you choose the expense and the payment account, the system credits the withholding payable and does not let you withhold more than the base. The free withholding calculator tells you how much is withheld and how much is received, or the gross amount you need to receive a desired net, with the rate you confirm.

This guide is informational and does not replace the advice of a licensed public accountant. Rates, ceilings and dates are adjusted by the authorities from time to time: confirm them at the official source before applying them.

Frequently asked questions