How Do I Withhold Tax or Take a Deduction From a Payout?

Add withholding or a deduction while you prepare the payout, in Prepare a Payout. Disburse doesn't offer this on its quick screen, so use Advanced Options. Syndelo doesn't decide who needs backup withholding. You choose the account and the rate.

Add a Deduction

1. Go to Payouts, click Disburse, then Advanced Options.
2. Fill in the payout. See How Do I Run a Distribution?
3. Open Fees, Withholding & Other Deductions, then Withholding and Deductions.
4. Click Add Deduction.
5. Choose the Account and the Type:
   • Backup Withholding (%): enter the Rate (%). It starts at 24%.
   • Fee (Fixed) or Other Deduction (Fixed): enter the Amount.
6. Click Calculate Allocations. The review shows Gross, Deductions, and Net for the payout and for each line in the Allocation Grid.

How the Amounts Work

• Backup withholding applies to the taxable part of the account's payout: interest, preferred return, and profit. It doesn't apply to returned capital.
• For example, 24% on a payout of $1,000 of preferred return and $4,000 of returned capital is $240. The account's net is $4,760.
• A fixed fee or other deduction comes off the account's gross payout. The money stays in the investment's cash and is set aside, so later payouts can't use it.
• The account must receive something in this payout, and its deductions can't be more than its gross payout.
• An investor's reinvestment choice applies to what's left after deductions.

Payments show the Adjustments on each row, broken out as Tax Held Back and Other Deductions. The account's payout notice shows them too.

Send the Tax to the Agency

The fund keeps withheld cash as tax owed until you pay it. Syndelo doesn't file or send the payment. Once you've paid it outside Syndelo:

1. Go to Money, open the Accounting tab, and choose the Investment.
2. Open Receipts & Refunds. Withholding Obligations lists what was withheld, what was remitted, and what remains.
3. Click Record External Remittance on the row.
4. Enter the External Settlement Date, Tax Authority, External Payment Reference, Tax Period, Remitted Amount (USD), and Review Notes. Choose the Receipt Document, tick I Confirm This Payment Has Already Settled Outside Syndelo., and click Prepare for Review.
5. Another team member reviews it under Waiting for Review on the Close the Books view.

You need Finance Preparer permission to record a remittance.