Portugal: Clarification on the certification of Mod.21-RFI and Mod.22-RFI
Effective
immediately
the Portuguese Tax Authorities (PTA) have provided clarifications regarding the certification of tax forms.
Background
Since 2014, it has been possible to certify the forms Mod.21-RFI (to obtain relief at source or quick refund) and Mod.22-RFI (to obtain standard refund) by providing a separate Certificate of Residency (CoR) in replacement of the certification of the form itself by the beneficial owner’s local tax authorities.
However, the CoR (6166) issued by the U.S. tax authorities was considered non-compliant by the PTA as it was not clearly mentioning that the beneficiary is subject to tax in that contracting state. It could therefore not be used to certify the forms Mod.21/22-RFI.
This has now changed following an exchange of information between both tax authorities and it is now possible to obtain a CoR 6166 form that satisfies the requirements of the PTA.
The PTA have also clarified the requirements regarding the other documents needed to obtain the application of the reduced tax rates (for example, CoR, statement for funds, self-declaration).
Impact on customers
Certificates of Residence
Non-certified Mod.21/22-RFIs have to be accompanied by a specific CoR issued by the tax authorities of the other contracting state (valid for a period of one year from CoR issue date). The separate CoR must contain information confirming:
- The residency of the beneficial owner for tax purposes during the period when the withholding took place; and
- That the beneficial owner is subject to tax in the country of residency.
For U.S. residents the CoR (6166) should contain the following specific wording:
“I certify that, to the best of our knowledge, the above-named taxpayer is a resident of the United States with the meaning of the United States – Portugal Income Tax convention”
Additional tax documentation
Customers providing several Mod.21/22-RFIs for the same beneficial owner in the same package only need to provide one original of each accompanying tax document (for example, CoR, statement for fund, self-declaration).
As an example:
A U.S. beneficial owner wishing to obtain relief at source on several upcoming dividend payments can provide several Mod.21-RFI forms in the same package and only one original CoR 6166 form.
Note: This rule can apply only when the documentation provided in the package is for the same beneficial owner.
Further information
For further information about procedures, customers may contact the Clearstream Banking1 Tax Help Desk, Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500, and Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248.