Transaction types and calculation of withholding tax:
The types of distributions that can have a withholding tax applied include Interest, Income, Return of Capital, Sale, and Redemption.
The percentage of withholding tax withheld is applied to the gross transaction total after any fees have been removed. If there are no fees applied to a distribution, the amount of withholding tax will be applied to the gross transaction total.
Setting withholding tax on the account level:
When a new account is created, users have the ability to set the percentage of withholding tax that they would like to have withheld on future distributions for this account. Using the '+ Account' button located within the accounts tab of an investor's profile, the withholding tax percentage can be set at the very bottom of the '+ Account' window:
Note: Having withholding tax set on the account will only include the amount of withholding tax for future distributions that are created as a batch.
Withholding tax and batch distributions
The withholding tax percentage that has been set on the account will be displayed in the transaction batch listing area. This can be edited if needed, and the percent and dollar amount of withholding tax applied to the distribution will be displayed on this page:
Withholding tax display:
Once the batch has been run and the transaction had been created, withholding tax details will be displayed in the following areas:
The transactions table within the transaction module and on an investor's profile:
The 'Transaction Details' page:
Investor Portal transaction details:
Additionally, the Distribution Report displays both the dollar amount and percentage of withholding tax that is applied to a distribution.
Applying withholding tax to individual distributions:
For any individually created distributions, the percentage of withholding tax must be set per transaction. It will not auto-fill based on the withholding tax percentage set on the account. This can be set in the 'Other Items' section at the bottom of the 'Create Transaction' window:
Note: The ability to set a withholding tax percentage in this area is limited to Interest, Income, Return of Capital, Sale, and Redemption transaction types.