Tax Expense calculates the tax expense and deferred values for a taxable entity to provide accurate daily valuations, or periodic adjustments to tax provisioning. Tax expense calculations may be undertaken daily or periodically to deliver accurate provisioning within unit pricing processes.

Tax Expense imports the fund’s income, expenses, unrealized gain values or any other account balance required to accurately calculate tax expense and deferred tax values for individual funds or single taxable entity groups of funds.

Accuracy in the calculation of a fund’s tax position creates both confidence in net asset values and transparency of after tax performance, which leads to improved tax management in the investment process.

Tax Calculation Features

  • Tax Expense calculations support:
    • Fund entities
    • Single taxable entities with multiple sub funds
    • Individual investor accounts
  • Avoids manual ledger reconciliations through real-time explanation between accounting income and taxable income.
  • Allocation of Expense and Income on a lookthrough basis
  • Automation of Deferred Tax Asset (DTA) and Deferred Tax Liability (DTL) calculations.

Tax Expense Automation

  • Distribution control record allows navigation from summary to detail level with ability for user to approve or re-run processing.
  • Straight-through-processing initiates on data arrival for multi-level fund structures.
  • Specific to clients or fund(s), tax related static data is configurable by business users.

DTA & DTL Calculations

  • DTA & DTL calculations include ability to utilize tax losses or quarantine capital losses.
  • DTA & DTL tax rates and discount rates maintainable at individual fund entity level.

Look-through Expense & Income Allocations

  • Expenses and Income are able to be allocated from underlying portfolio level to Member Investment Option or Retails Class levels via ownership look through.
  • Taxable Member Investment Options or Retail Classes can then calculate Tax Expense & DTA / DTL for delivery into unit pricing or tax management functions.

Reporting & Tax Expense Workpapers

  • Account Views directly reflect Tax Return structure and are configurable by business users.
  • Tax expense workpapers are designed to provide an auditable calculation trail including:
    • Capital Gains / Losses YTD : Income YTD
    • Income and Withholding Tax YTD
    • Expenses YTD
    • Expenses Allocated to Income
    • Income Available after Expenses Summary
    • Tax expense Pre-Tax Credits
    • Tax Credit Offsets
    • Tax Expense Value
    • DTA / DTL : Values for DTA / DTL Calculations
    • Tax Losses carried forward and Capital Losses carried forward

Jurisdictional Tax Framework

Unique to pControl is it's tax rule framework purpose built to manage tax business rules across multiple fund jurisdictions. Combined with pControl's single record Fund Ledger, this allows clients to manage a wide variety or jurisdictional requirements on a single platform:

  • Flexibility to configure jurisdictional specific calculations and reporting.
  • Business rules to allocate losses against gains, and manage carry forward items.
  • Business user defined allocation of attributes to tax categories.

See Jurisdictional Tax Framework to find out more.

Integration & Extensibility

  • Uploads, merges and validates data from multiple sources, including accounting systems, registry and transfer agencies, and external data providers, through pControl's native Data Manager.
  • Integrates with Income Processing for full automation of income allocation and settlement across interfunded investment structures.
  • Where all Fund Accounting functions are undertaken within pControl then Tax Expense directly utilizes pControl's single record Fund Ledger processing, Gain / Loss Management and Account Views functionality.

Service Level Aware

All pControl solutions are Service Level Aware and can internally monitor and escalate late running events such as late data arrival, and late override / approvals and final release within operational cut-offs and processing calendars.

Operations teams can monitor Service Level compliance through the following dashboards:

  • Production Summary dashboard to deliver progress monitoring of all required Tax Expense approvals and release for the period or for inclusion in daily pricing.
  • Attention Status Monitor dashboard to provide real-time exception monitoring and aging for any activity with critical completion or Service Level Agreement deadlines.

Tax Expense is stakeholder and auditor friendly through a full audit trail of all calculation activity, and via calculation proofs provided through the Tax Expense Workpapers.