|CDS acts as the Canadian withholding agent on all Canadian dividends, interest and trust income paid to the Depository Trust Company (DTC) for securities on deposit at DTC.
Prior to any given entitlement payment, DTC solicits the U.S. financial institutions that hold the security in its depository for withholding instructions on the payments that DTC will make to these financial institutions on payable date.
DTC summarizes these instructions and provides a single withholding instruction to CDS on the amount of tax that is to be deducted by CDS. CDS withholds accordingly, remits the net payment to DTC and sends the tax to the Canada Revenue Agency (CRA). At year-end CDS files the requisite NR4 form with DTC and with the CRA. CDS does not do any other tax reporting on the payment.
CDS does not have access to information regarding the underlying investors and their residence status.
See also, tax services.