This module will not be further enhanced. Support is limited to defect fixing only.

Introduction to TOB Tax

Calculation and withholding of Belgian TOB (Taxe sur les opérations de bourse ) tax on trades, beneficiary owner change transfers, and coroprate actions. Applicable to Belgian tax residents. In case of joint ownership of portfolio, tax is subjected and pro rated only to those customers whose residence is Belgium.

Withholding Tax

This functionality allows banks to calculate the Belgian transaction tax (TOB tax) for persons, in case of co-holding with a customer who is not a Belgian resident, the calculation of the tax is split in equal parts among the account holders and only for the part of the account attributable to Belgian fiscal residents the income is submitted to the TOB tax.

In most cases, this country is the same as the legal residence country. However, sometimes there are some exceptions like for the diplomats or European officers, which is why the tax residency is regarded and defined in the system as per the CRS rules. So, if one of the client’s tax jurisdictions is Belgian for CRS purposes, the TOB tax is applied based on the CRS documentation received.

It is also possible to exempt any client from the TOB tax. The exemption is based on the presence or not of the ETOB: ATTEST. NON-SUBMISSION BELGIAN TAXES document in the CUSTOMER documents.

Only the transactions executed on the secondary market are subject to the TOB tax. Transactions executed on the primary market (issuance of new securities, etc.) are not subject to the tax.

However, some corporate actions are more complex and require a more in-depth analysis of the prospectuses and other information obtained at the time of the operation is able to determine whether it is an operation on the primary or secondary market. A tax services user will manually enter the information before the execution of the operation. Only transfers with change of beneficial owner are subjected to the TOB tax.

The TOB tax rate and the ceiling are determine based on the type of securities. The TOB tax amount is calculated based on pro rata basis and subject to ceiling. The TOB ceiling is applied to eligible customers and not to transactions.

The following items are introduced as part of this functionality:

• The BETOBT.TAX.CONFIG application stores the parameter information.
• The BETOBT.TAX.PARAMETER application stores the tax related information.
• The Taxable Basis Amount field was added to the ENTITLEMENT application to store the taxable basis amount which qualifies for the BETOBT PFNL tax.
• The Eff Tax Res field is added to the CUSTOMER,BETOBT.INPUT version to capture the effective tax residence of the customer.

Click here to understand the terms and abbreviations used in describing this functionality.