Paying suppliers overseas is no cakewalk, especially when it comes to making sure the accounts payable department complies with all the different tax regulations across jurisdictions.
A new service from global payments management platform Tipalti aims to make it easier to assure that corporate money managers are paying their suppliers within regulatory bounds.
In an announcement made Tuesday (Sept. 15), Tipalti revealed the launch of its Form W-8 collection solution, a tool that provides U.S. corporate buyers with a mechanism to automate the accounts payable processes when settling invoices from overseas sellers.
The service ensures W-8 tax compliance with these payments, and according to the company, auditor KPMG has reviewed the solution and confirmed that it meets the compliance standards required by the Internal Revenue Service.
“Today’s Form W-8 collection and withholding requirements are complicated and confusing and make the already difficult process of managing and paying overseas suppliers even more challenging,” said Tipalti CEO and Cofounder Chen Amit in a statement emailed to PYMNTS. “Our new W-8 capability dramatically simplifies the process of managing and paying overseas suppliers, while ensuring compliance with the constantly changing tax and regulatory requirements.”
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Through a Web-based assistant, Tipalti’s new system helps suppliers select the correct tax forms. The data on those forms is then reviewed and validated against the IRS database. Payee withholding requirements are automatically calculated, and a summary of those withholding instructions are then included for the corporate buyer.
Tipalti then automates these deductions from the payment to ensure businesses are set for tax filing season, the firm added. The system also automates the process of keeping up to date with the newest tax rules.
“Additionally, because of Tipalti’s cloud-based platform, future changes to filing requirements by the U.S. government will be automatically updated without any technical intervention from payers,” the firm said.