Italy: Dividend tax - Exemption of EU/EEA collective investment vehicles
Further to TaxFlash T20020 and Announcement L21001, Clearstream Banking1 informs customers of the following applicable operational procedure.
Effective
immediately
EU/EEA collective investment vehicles (CIV) may apply to exemption at source or through quick refund through Clearstream Banking by providing the relevant certification by the prescribed deadline.
Background
Law No. 178 (Article 1, paragraph 631) provides the possibility for EU/EEA CIVs fulfilling the following eligibility conditions, to apply for a tax exemption on Italian-sourced dividends paid as of 1 January 2021:
The first condition regards the type of foreign investment funds eligible for the tax exemption:
- The CIV is established in accordance with Directive 2009/65/EC of 13 July 2009 of the European Parliament and of the Council (UCITS Directive); or
- If it is not established with the UCITS Directive, the CIV has a fund manager or managing company subject to regulatory supervision in the foreign country where it is established in accordance with Directive 2011/61/EU of 8 June 2011 of the European Parliament and of the Council (AIMF Directive).
The second condition regards the country of incorporation of the CIV, which should be an EU member state or EEA country with which Italy has an exchange of information (Norway, Iceland and Liechtenstein).
Impact on customers
Relief at source
In order to benefit from exemption from withholding tax at source on Italian-sourced dividend income, an eligible CIV should provide, within the deadlines prescribed by Clearstream Banking, the following documentation:
- One-Time Certificate for Italian Equities, duly completed and signed by the customer.
- One-Time Master Instruction/Dividends at Source (OTMI), to be completed and signed by the foreign CIV for which the exemption is requested.
- Self-certification for EU/EEA collective investment vehicles, issued by the foreign CIV declaring that it is eligible for the exemption. The self-certification does not need to be certified by the beneficial owner’s tax authorities or with a separate certificate of residence (COR). This self-certification is valid until revoked.
- Copy of a document evidencing who the legal representative (or the representative agent) of the foreign CIV is or of the management company as follows:
- For foreign CIVs whose investments are managed by a management company, a copy of a deed providing the following information:
- Identification of the management company (company name, address, etc.);
- Details of the legal representative of the previously mentioned company;
- For foreign CIVs whose investments are managed by a management company, a copy of a deed providing the following information:
- For foreign CIVs with a representative body, either incorporated (for example, SICAVs) or not incorporated, a copy of the deed providing the identification data of either the legal representative (or the representative agent).
- Italian Equities: List of Beneficial Owners. To be provided only if the customers hold equities in their account on behalf of more than one beneficial owner.
Quick refund
A quick refund is available through Clearstream Banking for eligible beneficial owners who did not obtain relief at source. The documentation is the same as for relief at source described above.
Deadline for receipt of documents
Documentation for relief at source from withholding tax on dividends from Italian equities must be received by Clearstream Banking by the following deadlines:
Document | Deadline for receipt by Clearstream Banking |
One-Time Certificate for Italian Equities | The ex-date of the first dividend payment by 10:00 CET. |
One-Time Master Instruction/Dividends at Source (OTMI) | The ex-date of the first dividend payment by 10:00 CET. |
Self-certification for EU/EEA collective investment vehicles | The ex-date of the first dividend payment by 10:00 CET. |
Italian Equities: List of Beneficial Owners | The ex-date of each dividend payment by 10:00 CET. |
Copies of documentation evidencing the identity of the representative or management company | The ex-date of each dividend payment by 10:00 CET |
The deadline for reclaiming withholding tax using the quick refund procedure through Clearstream Banking is 10:00 CET on the eighth calendar day (or the last business day before the eighth if the latter is not a business day) of the month following the month in which the dividend payment took place.
Further information
For further information, please contact the Clearstream Banking Tax Help Desk, Clearstream Banking Client Services or your Relationship Officer.
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1. Clearstream Banking refers collectively to 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, and 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.