Wolters Kluwer has introduced a new tool to help banks, brokers and other financial services firms meet existing IRS standards and new rules that become effective on 1 January 2019.
The new solution, dubbed Capital Changes 871M Automated Compliance Tool, has been designed to meet US withholding and other reporting needs related to dividend equivalents on US source derivative financial instruments sold to non-US persons.
Wolters Kluwer said that the solution complies with challenging aspects of broker compliance for option contracts, and other similar contracts.
The solution also helps withholding agents to adhere to various areas of the new regulations such as applying the dividend payment date election and applying the rules for omnibus accounts.
Wolters Kluwer vice president of tax and regulatory counsel for investment compliance business Stevie Conlon said: “Our Capital Changes 871M Automated Compliance Tool is an industrial-strength solution designed to help financial institutions avoid costly errors in applying difficult new withholding tax rules.
“This is a capability that is especially crucial for firms, given the daily processing, batch file transfers, and high volumes of their customers’ activities.”