An alternative to the established tax reclaim vendors is now available. The Xceptor Tax Hub, created by software firm Web Services Integration, promises a new type of service that is in tune with the worldwide shift (encouraged by the OECD) from reclaiming withholding tax towards offering tax relief at source. An early buyer of the product is HSBC Securities Services (HSS).
John Everett, Head of Tax, Custody, Europe, HSBC Securities Services, is impressed by the ability of the system to store tax data from dozens of jurisdictions, married it up with client portfolios, and alert staff to issues and opportunities. He also values its ability to cope with tax relief at source as well as tax reclaims. “Xceptor has provided a modern and improved platform which has revolutionized our approach to operational tax processing, and has made a huge impact with regards to our relief at source documentations,” he says.
According to WSI this software, manages tax data, income and payment information from multiple sources, stores all relevant tax authority and client information, accepts dividends and holdings, and calculates reclaims. The company says this has allowed HSS “to remove manual intervention and significantly reduce errors” from this “very complex” and “highly paper based” area.
WSI adds that keeping up with the changing legislation in this area, as the OECD try to encourage countries towards tax relief at source rather than traditional tax reclaim processes, will be simplified by using this software. There are over 50 tax reclaims procedures within the EU alone. John Everett says that, “by enabling us to manage all tax reclaims through one system and in one place it has given us control over the complete auditable process and we now have complete confidence in the results being generated.” He adds that this “saves vast amounts of time and reduces risk.”
Global custodian banks wrestling with the challenge of collating and verifying tax data from multiple sources- agent banks, accountancy firms, and the International Bureau of Fiscal Documentation at The Hague – ought to welcome this functionality. It also poses an interesting competitive challenge for the established tax reclaim providers such as Globetax, Goal, and systems like Tax Manager from Global Equities, and TaxTracker.
“The strategy with Xceptor was to enable banks to integrate a range of diverse manually intensive activities,” says Peter Madigan, director at WSI, he continues: “We’re confident we can now provide a tailored solution to any other bank with a similar set of issues.”
Having been successfully launched in London, Xceptor is to be extended for use at HSS globally.