All posts in Sprintax TDS

  • Which tax forms does Sprintax TDS support?

    tax forms Sprintax TDS supports

    Sprintax TDS is a secure hassle-free online software, which will help your institution to manage tax compliance for each of your nonresidents.

    In this guide, we are going to take a closer look at the many tax forms which can be prepared for your nonresidents using Sprintax TDS.

    Form W-4

    Every nonresident working in the US must complete a W-4 when starting a new job.

    This form is used to determine exactly how much tax should be withheld from the nonresident’s paycheck.

    Sprintax TDS enables nonresidents to complete their W-4 correctly and factors in all relevant tax credits and deductions.

    Form W-4

    1042-S

    If a nonresident receives any of the below forms of income, their tax withholder must provide them with a 1042-S before 15 March.

    • Scholarship
    • Fellowship
    • Grant
    • Teaching or research income (where exempt under a tax treaty)
    • Compensation during study and training (exempt by a tax treaty)
    • Investment income
    • Deposit interest on a US bank account

    Form W-8BEN

    Form W-8BEN

    Income earned by nonresidents in the US is typically taxed at a rate of 30%. However, the nonresident may be entitled to a reduction in tax by availing of tax treaty benefits.

    In order to claim tax treaty benefits, nonresidents must complete the form W-8BEN.

    Sprintax TDS will outline any tax treaties that are available to your nonresidents.

    Form W-8BEN-E

    Money generated by foreign businesses is also typically subject to a 30% tax rate. By completing a Form W-8BEN-E (also known as Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting), foreign vendors can avail of tax treaty benefits and a reduction in tax.

    Sprintax TDS automatically generates Form W-8BEN-E for foreign vendors.

    Form 8233

    Form 8233 must be filed by all nonresidents who earn a certain type of scholarship, personal services or fellowship income including compensatory scholarship or fellowship income from the same withholding agent.

    With this form, the nonresident aliens claim exemption from withholding for certain personal services, because of an income tax treaty.

    Sprintax TDS will enable nonresident users to complete their Form 8233 easily online.

    Form W-7

    Nonresidents can also apply for an Individual Taxpayer Identification Number (ITIN) with Sprintax TDS.

    Nonresidents will need an ITIN if they are not eligible to receive a Social Security Number, but they are eligible to receive scholarship payments.

    They also need to file a federal tax return with the IRS for income from US sources or if they are entitled to a refund of withheld taxes under a tax treaty. Form W-7 can be used to apply for a new ITIN if the existing one is expiring.

    Form W-9

    Form W-9 is used to provide and certify a Taxpayer Identification Number (TIN) and to verify that the nonresident is not subject to backup withholding.

    Typically this form is used when a person is required to report certain types of payments. It is also used by a third-party who should file an information return with the IRS. Form W-9 requests information from the taxpayer such as name and address.

    Form W-9

    Form SS-5

    Form SS-5 is a social security administration’s application document for requesting a social security card, whether it be a new card or a replacement one.

    The nonresident must provide certain documents that prove their identity, age, citizenship status and they must be the originals not photocopies (or certified by the agency that issued them).

    Want to learn more about how Sprintax TDS can help your payroll department?

    To find out more about Sprintax TDS, why not register for a free demo here.

     

  • 5 Painful payroll problems Sprintax TDS instantly solves for educational institutions

    Properly documenting and withholding the right amount of tax from nonresidents has become an increasingly important issue for educational institutions.

    International students come from a variety of different countries and spend different amounts of time in the US. So how can you manage all of your international students from a tax perspective when no ‘one-size-fits-all’ rule applies?

    Sprintax Tax Determination System (TDS) is a tool that ensures nonresidents are taxed correctly from their first day working in the US – guaranteeing that the right amount of tax is withheld from their earnings and reported to the IRS.

    A cloud-based payroll software, Sprintax TDS is already working with more than hundreds of educational institutions all over the US.

    How does Sprintax TDS work?

    The first point to note is that Sprintax TDS is completely cloud-based. No software installs are required. As soon as foreign nationals come into the campus, they are assigned an account on TDS.

    They answer a simple online questionnaire and, based on their answers, our payroll tool determines their residency status for tax purposes, as well as identifying what treaty benefits they are entitled to and whether they can avail of any deductions.

    Sprintax TDS also enables you to withhold the correct amount of tax from payments made to them.

    Finally, our software generates the relevant tax forms for the nonresident – including forms 1042-S, W-4, W-8BEN, 8233. It can also generate the W-8BEN E series if you are engaging with foreign vendors.

    When filling out our questionnaire, students can rely on an experienced Live Chat support team 24/7 who can answer their questions.

    When tax filing season comes around, students can transfer their data to the Sprintax tax preparation software. This will enable them to prepare their Federal and State tax return (and form 8843) easily online.

    How Sprintax TDS helps you solve payroll problems

    1. It saves time!

    It can be complex and time-consuming to determine how to individually tax each one of your international students and scholars.

    Sprintax TDS is a tool specifically designed to help schools withhold and report the correct amount of tax from US payments to nonresident students, scholars and professionals who are being paid scholarships, wages and stipends.

    2. It cuts out paperwork

    Our software Sprintax is an innovative, paper-free way to manage all tax-related forms.

    Instead of dealing with endless paperwork, Sprintax TDS allows you to store information securely in the cloud.

    The document exchange function allows your nonresidents to store and upload tax-related documents in a secure place that you can access as needed.

    3. Tax treaty research is a thing of the past!

    Forget spending hours leafing through the IRS website researching tax treaty agreements.

    You can easily determine whether your nonresidents are eligible for any tax treaties and deductions with Sprintax TDS. Our software also confirms whether or not the employee is a resident or nonresident for tax purposes.

    4. Forget archaic solutions! Sprintax TDS is a user-friendly, one-stop shop!

    The software highlights the tax status of your international scholars and students on a convenient admin dashboard and defines how they should be taxed on income from your institution.

    You can upload multiple users to the system or manually upload students by entering their name and email on the upload wizard. The users will receive a welcome email with a link to their TDS portal.

    You can see in real-time how many students have completed their accounts and view all the activity that is taking place in the system.

    Admins will also have reports and access to important payroll information such as tax residency status, country of residence, applicable tax treaties and their status on TDS.

    You can also generate your own individual report with the information you prefer. You will be able to choose the columns you wish to see and export the report into a CSV file.

    The administrator is able to access the student’s portal and edit the information on their profile, to make sure the information is correct. The system documents who was the last user to make any changes. The admin will also be able to generate a 1042-S form for each selected user.

    Admins can access a report of all payments per user, income code, dates, tax rates, tax calculated and all other information that the institution may need to review for each student. To make it even easier, all the information can be exported into Excel.

    The dashboard will also give you information about the students who have missing information and you will be able to send them reminders.

    Sprintax TDS resolves payroll problems

    5. We remove tax season stress!

    Each nonresident’s details can be transferred from Sprintax TDS into our tax preparation solution. This will enable each user to easily file their tax documents (Federal and State tax returns and form 8843) before the deadline.

    Want to learn more about Sprintax TDS?

    To find out more about how Sprintax TDS can help your payroll office, why not register for a FREE Sprintax TDS demo here.

     

     

  • 5 Important US tax documents every international student should know

    Tax solutions for nonresidents in the US

    Let’s face it – tax is super boring!

    And when you move to the US as an international student or scholar, the local tax system will likely be the furthest thing from your mind.

    However, boring or not, compliance with the American tax authorities – the IRS – is crucial for any international student. In fact it’s one of the conditions of your visa! And how you handle your US tax affairs can play a big part in the outcome of your future visa or Green Card applications.

    But, by doing some research into US tax when you first arrive, you can save you a lot of hassle down the line.
    Continue reading “5 Important US tax documents every international student should know” »

  • Filing 1042-S – How to Prepare for Tax Season

    tax filing regulations of international students

    Preparing a 1042-S isn’t an easy task, and to make matters worse, filing incorrectly can lead to penalties, fines and unnecessary stress.

    But not to worry, today we will address some of the most common questions associated with filing a 1042-S: What is a 1042-S? How do I know what income to report? What deadlines should I be aware of when filing a 1042-S? Should I be aware of any changes in filing regulations since last year?
    Continue reading “Filing 1042-S – How to Prepare for Tax Season” »

  • Hiring nonresident employees at your school? Here’s how to ensure you are tax compliant

    Withholding tax on nonresidents working in US universities

    The number of international students in the US spiraled over 1 million in 2018.

    And with many of these students also working part-time at their chosen schools, the proper documentation and withholding on payments to nonresidents has become an increasingly important topic for educational institutions in recent years.
    Continue reading “Hiring nonresident employees at your school? Here’s how to ensure you are tax compliant” »

  • Introducing Sprintax TDS – Tax Determination Software

    Sprintax tax determination software for payrol and HR offices

    How much tax should an international student be paying?

    Tax. Granted, not the most exciting topic in the world. But its importance can never be called into question.

    Over recent years the proper documentation and withholding of payments to non-resident students and scholars has become an increasingly important issue for US educational institutions.

    How much tax should an international student being paying? Are they entitled to any reliefs or deductions? Who can help them handle their US tax?

    Finally there is an easy to manage, easy to use solution which makes US tax easy for international students – Sprintax TDS.

    Continue reading “Introducing Sprintax TDS – Tax Determination Software” »