Operational Taxes
Financial Services
Operational taxes face various challenges, resulting in a more intricate and demanding landscape for our market participants.
We observe clients needing to adjust and modify their approach in several ways:
Increased compliance and reporting obligations
Tax governance requirements; are roles and responsibilities clear, with effective processes and escalation points?
AOEI, TRACE, CCO, MDR programmes and new rules in market territories.
Tax transparency e.g. uncertain tax positions, tax strategy and management reporting.
Horizon scanning, change management and transparency
Demand for more data
Managing withholding tax obligations involves tracking conditional data for confirming reliefs, adhering to holding period requirements concerning securities during dividend dates, and monitoring capital gains thresholds.
Investor reporting encompassing tax claims/value reconciliation and managing cash flows related to reclaims and relief-at-source.
Monitoring issues, tracking actions, prioritising tasks, and escalating actions through workflow processes.
How can we support your business?
Our team is comprised of individuals who have worked for global custodians, investment banks and asset managers. Our years of subject matter expertise will ensure that you are well prepared to best the daily challenges you face and upcoming ones.
Automatic Exchange of Information
Ensure efficient reporting to clients and tax authorities
Governments worldwide increasingly prioritise tax transparency. The OECD formulated the Common Reporting Standard (CRS) as the global benchmark for comprehensive and multilateral automatic exchange of information (AEoI). This impacts a range of financial and non-financial institutions.
CRS imposes obligations on Financial Institutions to:
- Gather data to establish customers’ tax residency.
- Report account holder details to local tax authorities, who then exchange this with the relevant countries.
Over 100 countries have adopted CRS for automatic exchange of information on customers resident in co-signatory jurisdictions. CRS is a distinct reporting requirement from FATCA. It became active on 1st January 2016 when early adopter countries began data collection for 2017 tax authority reporting.
How can we support your business?
We collaborate with Financial Institutions, assisting in aligning with CRS for account holder due diligence and reporting.
Our extensive technical knowledge enables us to help you plan for CRS implementation, considering its broader impact on the business, including:
- Identifying group entities involved
- Project approach
- Gap analysis between CRS and FATCA
- IT and systems adaptations
- Document adjustments
- Compliance checks
- Enhancing customer experience
- Training and communications
U.S. Qualified Intermediary (QI) regime
Are you compliant?
The US Qualified Intermediary (QI) regime mandates payers of US-source fixed, determinable, annual, and periodic income to identify and document their customers according to a contract with the US Internal Revenue Service (IRS). Under the QI Agreement with the IRS, financial institutions are obliged to establish procedures for monitoring and responding to changes in customer circumstances. They must regularly assess the efficiency of their controls and certify these measures to the IRS.
How can we support your business?
- Registration of a QI with the IRS
- Training and continuous support for the Responsible Officer (RO)
- Implementation of internal control procedures and governance
- Formulation of QI policies and protocols
- Conducting Periodic Reviews (PRs) and Interim Compliance Reviews (ICRs)
- Examination of tax withholding statements and reporting documentation
- Training sessions for QI operational staff (including documentation and reporting)
- Assistance and support for RO certification
