Citi today announced that its Global Transaction Services business has launched a new Global Custody tax application.
The new system, designed to service global investor clients - including financial institutions and corporations - provides an automated, fully integrated workflow solution to efficiently meet the increasingly complex global tax requirements mandated by tax authorities worldwide.
This innovative offering replaces current manual processes with electronic record keeping, facilitating better downstream tax servicing for clients through consistent standardization, more streamlined processes, improved controls and increased productivity. It will complement the existing suite of asset servicing applications and will support Citi's Custody services covering over 90 markets globally.
"Over the last ten years, there have been significant increases in the complexity of the processes and legal requirements for tax operations," said Mary Fenoglio, Global Head of Global Custody, Citi. "Tax authorities around the world now require greater levels of documentation from beneficial owners seeking reclamations from overseas tax jurisdictions. At the same time, the European Union has vowed to address potentially discriminatory legal claims against pension funds based in other regions. Tax authorities are also increasingly sharing their cross-border fiscal information in an attempt to tackle tax evasion. These developments have raised considerable challenges for asset managers. With tax experts globally, Citi can address these challenges."
In addition to this new tax application, Citi provides a suite of seamless custody tax services so that client intervention is reduced to a minimum. These include:
- Withholding tax reclamation
- Submission of relief-at-source tax documentation to the local market sub-custodian
- End-to-end tax documentation re-solicitation
- Withholding tax reporting
- Provision of comprehensive tax information by market of investment
- Tax profiling.
Citi's Fenoglio adds:s: "With the new tax application and our other complementary custody tax services, our clients benefit from our unparalleled proprietary sub-custodian network to provide local market intelligence; our comprehensive database of tax information, including global profiles for key tax structures; and our global team of tax experts with unmatched expertise in meeting the tax challenges of today's marketplace. This latest development is just part of our ongoing plans for continuing to deliver a best-in-class tax offering for our clients."
Further developments are currently in process. The next phase will include the ability to pre-populate tax documentation and new functionality that will replace the current tax profiling application.