TRACE (Tax Relief and Compliance Enhancement) is an initiative from the OECD. It aims at allowing the claiming of withholding tax relief at source on portfolio investments and removing the administrative barriers that affect the ability of portfolio investors to effectively claim the reduced rates of withholding tax.

The TRACE implementation package was first published by the OECD in 2013 and is now being implemented by Finland with other jurisdictions to follow. TRACE is also part of the economic recovery measures published by the European Union Commission in September 2020. This means that tax relief at source will be a major topic in the coming years.

The regime requires Financial Intermediaries (so-called Authorized Intermediaries or AI) to report to the issuer country the detailed information about income they pay to downstream agents or beneficial owners. The TRACE regime and its requirements is inspired by the U.S. Qualified Intermediary (QI) regime that was created in 2001.

Regnology supports the reporting requirements imposed by both the QI and TRACE regimes with our Regulatory Tax Reporting. The software also includes a reconciliation feature and client reporting capabilities. Our tax experts, with their many years of know-how in operational tax, can also support you with your specific issues and the implementation of our solution.

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