When is it appropriate to withhold information?

"I'd say when the information is incomplete, depending on its gravity. I'm pretty good at anticipating the needs of my employers and managing up. So, unless I have the complete picture, and take the course of action I know I should take, I'm not going to bring it to my superior's attention until I have something worthy to present. Otherwise they'll ask me questions I should already have the answers to. If I'm going to distract them from the pressing concerns they face, I'm gonna make sure I've lightened the load as much as I can first."

This is a tricky question which heavily relies on your interpretation of any given situation where this could apply. In fact, your interpretation is the primary of the question. It serves to reveal more about you, your integrity, and your regard for the chain of command, your clients, and your sense of transparency.