Some of the key discussions that we had were:
871(m) – Rules governing dividend equivalents and stock lending activities
With the rules due to come into force in 2021, the industry is not going to get the expected/desired 18 months of lead time.
No guidance has been issued by the IRS yet, there remains a question mark over whether the rules will be delayed. Speaking with others at the Conference, the consensus view was that the rules will not be delayed, but that penalty relief may come into play.
1446 (f) – Withholding on disposition of partnership interest.
We had a number of fruitful discussions where the focus was on who is obligated to execute the withholding – is it the partnership or the executing broker – we discussed a number of different scenarios where the obligation moves from one party to the next and may trigger withholding.
There are particular issues for brokers and custodians with respect to publicly traded partnerships (PTPs).
Treaty Withholding – Reclaims and relief at source
Another big topic was around Treaty withholding claims –either upfront relief at source – or the reclaim of foreign tax. An important angle we discussed with a number of colleagues was with regards to a number of countries that have additional rules under the OECD TRACE schema and specific documentation requirements for the refund of overpayment of tax.
A key question: Could some documentation be automatically sourced from elsewhere in the onboarding process?
Industry Working Group on Standardised withholding Statements:
The reception from conference colleagues to the TAINA co-ordinated initiative for the standardisation of withholding statements was great – we had a number more declarations of interest and requests to be kept appraised of developments. We are looking to build the largest coalition possible, so if you would like your organisation to form part of the working group, do let us know.
We had a great time listening to a number of insightful sessions on:
Latest IRS Audit Initiatives, Non-US Withholding and Reclaims, State Information Reporting and Withholding, Chapters 3, 4 and 61, DAC6, FATCA and CRS Updates, Section 958, QDD 871(m) and Section 1446(f) regulations on PTPs.