At its meeting in January 2013, the Committee on Fiscal Affairs approved the TRACE Implementation Package, a self-contained set of agreements and forms to be used by any country that wants to implement the so-called Authorised Intermediary ("AI") system.
The AI system is a standardized system for claiming withholding tax relief at source on portfolio investments. It removes the adminstrative barriers that currently affect the ability of portfolio investors to effectively claim the reduced rates of withholding tax to which they are entitled pursuant to tax treaties or to domestic law of the country of investment. It minimises administrative costs for all stakeholders and enhances the ability of both source and residence countries to ensure proper compliance with tax obligations.
The TRACE Group will now work on a plan for country adoption of the Authorised Intermediary system and will assist countries considering implementing the system. Work will also continue to ensure that the reporting requirements under TRACE are aligned to those of other emerging reporting regimes (including FATCA) in order to reduce implementation costs for all stakeholders.
Public Documents Relating to TRACE Work