Quick refund - eligibility, documentation, deadlines - Polish debt securities
Who can obtain quick refund?
Quick refund depends on the type of Polish debt securities and is available through Clearstream Banking for the following beneficial owners :
Government bonds (treasury bonds, municipal bonds) | Corporate bonds, covered bonds and PLN denominated mortgage bondsa | |
Individuals (resident and non-resident) | 19% | 19% |
Supranational or international organisations of which Poland is a member | 0% | 0% |
Foreign central banks | 0% or DTT rate | n/a |
Foreign governments, foreign administrative sub-divisions and foreign local authorities | DTT rate | DTT rate |
Foreign banks and investment firms (as defined in EU MiFiD regulations) | DTT rate | DTT rate |
Entities specifically mentioned in the DTT signed between Poland and their country of residence | DTT rate | DTT rate |
a. Only certain PLN mortgage bonds issued before 1 January 2015 are still subject to withholding tax. PLN mortgage bonds issued as of 1 January 2015 and Euro-Denominated mortgage bonds are no longer taxable
Due diligence (pre-approval)
Eligible beneficial owners who wish to apply for a quick refund must first be pre-approved by the depository.
The following certification must be provided by the stated deadline to allow the depository to perform the due diligence and confirm the eligibility of the beneficial owner for quick refund.
The due diligence performed by the depository consists of verification of the certification provided (if correctly filled in, stamped, apostilled, etc.), specific researches on the correctness of the information provided, and compliance checks on beneficial owners. For instance, if a beneficial owner declares itself to be an investment firm, the depository will verify this information with the available registrars.
It is however the entire responsibility of the final beneficial owner to:
- Monitor its tax status and applicable tax rate,
- Verify the applicable DTT,
- Monitor the changes of circumstances impacting its tax status (e.g. change of name, address, etc.).
The due diligence verification is a key element to apply relief at source or quick refund, and customers must be aware that providing the required documentation does not guarantee eligibility for the quick refund.
Documentation requirements
The documentation requirements are described below and the templates of the forms are available under Tax Forms to use - Poland section. Upon submission of the relevant documentation, Citi Handlowy will perform due-diligence analysis and confirm whether a reduced tax rate (or tax exemption) can be applied.
The documentation requirement depends on the type of entity as follows:
Individuals, only the reduced rate of 19% can be obtained upon disclosure of the status as follows:
- One-Time Certification for Poland withholding tax purposes regarding Debt securities held in Clearstream Banking
An original One-Time Certificate should be completed and duly signed by the customer and specifying, among other things, whether or not the customer is the sole BO of all the Polish debt securities held in the account,
The Document must be provided once before the quick refund deadline. It remains valid until revoked. Any changes to any details must be communicated in a new OTC.
- Per-payment instruction per each tax rate provided via SWIFT (formatted MT565) or Xact Web Portal Message that includes:
- Customer Account Number
- ISIN
- Corporate Action Reference ID
- Payment Date
- The total holding of securities
- Full name, Fiscal address, and TIN number of the Beneficial Owner
- Country of Residence for Tax Purposes
- Tax rate to apply
- Holding for which the reduced/exempt tax rate applies
The beneficial owner per-payment instruction must be provided for each quick refund application.
For all other types of investors
- One-time certificate (OTC) for Polish debt securities.
The original, completed and duly signed by the customer and specifying, among other things, whether the customer is the sole beneficial owner of all the Polish debt securities held in the account, must be provided once before the first income/redemption payment. It remains valid until revoked. Any changes to any details must be communicated in a new OTC.
- Power of Attorney
A Power of Attorney should be provided if a third party is completing the Declaration of Beneficial Ownership.
The document must be provided once before the quick refund deadline and remains valid until revoked.
- Per-payment instruction per each tax rate provided via SWIFT (formatted MT565) or Xact Web Portal Message that includes:
- Customer Account Number
- ISIN
- Corporate Action Reference ID
- Payment Date
- The total holding of securities
- Full name, Fiscal address, and TIN number of the Beneficial Owner
- Country of Residence for Tax Purposes
- Tax rate to apply
- Holding for which the reduced/exempt tax rate applies
The beneficial owner per-payment instruction must be provided for each quick refund application,
And, In addition, and depending on the type of entity:
Type of entity | Documentation required (English language only) |
Foreign central banks |
|
Foreign governments, foreign administrative sub-divisions and foreign local authorities |
|
Foreign banks and investment firms (as defined in EU MiFiD regulations) |
|
Entities specifically mentioned in the DTT signed between Poland and their country of residence |
|
Supranational or international organisations |
|
Important: Investors who obtained a ruling from the Polish Tax Authorities on the applicability of the DTT rates must provide a copy of such ruling together with their certification for review and evaluation. Then original or notarised copy of such ruling will be required.
Deadlines for receipt of documents1
In order to benefit from relief at source, eligible beneficial owners should provide the required documentation within the below prescribed deadlines. If any instruction, tax certification or amendment is received after these deadlines, the customer’s entire application for relief at source will be rejected, with the possibility to be processed via the quick refund.
Quick refund | Deadline for receipt by |
Original certificates | At the latest, four business days before the last business day of the month in which the payment was made by 10:00 CET. |
Per payment instruction | At the latest, ne business day before the last business day of the month in which the payment was made 10:00 CET. |
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1. Customers are strongly recommended to verify the deadlines of each event in our tax notifications, as those may be subject to changes upon the request of the issuer.