Turkey: Renewal of Certificates of Tax Residence - Reminder

05.12.2016

Customers of Clearstream Banking1 are reminded that in order to benefit from a reduced Double Taxation Treaty rate on Turkish cash dividend payments, the Certificate of Tax Residence must be renewed on an annual basis for both non-resident individuals and institutional beneficial owners.

Renewal process for customers

Customers are consequently strongly recommended to start the renewal procedure, if appropriate, as early as possible in the first quarter of 2017. However, please see below the specific requirements related to the potential previous certification of the beneficial owner:

  • For beneficial owners (non-resident individuals and institutions) who have not filed a Certificate of Tax Residence in 2016
    Beneficial owners for whom a Certificate of Tax Residence has not been submitted in 2016 are reminded that the Certificate of Tax Residence , duly completed, signed and stamped, must be received by Clearstream Banking no later than 09:00 CET 21 business days before the first dividend payment to which it applies. 
  • For beneficial owners (non-resident individuals and institutions) who have filed a Certificate of Tax Residence in 2016
    For beneficial owners for whom a certificate of tax residence for 2016 has been submitted, its validity will be extended according to the following general rules:
    • A Certificate of Tax Residence submitted in 2016 remains valid until 31 March 2017 on the condition that we receive a new Certificate of Tax Residence, duly completed, signed and stamped by the local tax authorities of the final beneficial owner before 10 March 2017 by 09:00 CET.
    • The payments of the first quarter of 2017 are certified and relief at source will be applied, based on the certificate of tax residence received in 2016. However, if no new Certificate of Tax Residence is submitted by the above deadline, reversals will be required for this payment period.  

Form requirements of the Certificate of Tax Residence

Customers are reminded that the Certificate of Tax Residence must be issued by the beneficial owner's tax authorities and include the following information:

  • The beneficial owner's full name, TIN, date of establishment (corporates) or date of birth (individuals) and address;
  • A reference to article 4 of the DTT or reference to the Double Taxation Convention between the country of residence of the beneficial owner and Turkey and may not contain phrases such as "exempt from tax" or "not liable to tax"; and
  • The validity period (dd/mm/yyyy – dd/mm/yyyy)
    NB: All issuers are requesting the Certificate of Tax Residence with clear validity period details. Therefore, if a local tax authority does not issue a Certificate of Tax Residence with the above format, then the certificate must as a minimum state “for the year YYYY”.
  • A validity period dated in 2016 will not be accepted for payments in 2017.
  • Dated in the same year that the dividend is paid but before the first relevant dividend payment date in 2017.

The Certificate of Tax Residence must furthermore be provided to Clearstream Banking in original. It will be translated by a translation agency appointed by Clearstream's local depository and then notarised in Turkey by a notary appointed by Clearstream's local depository. The translation agency offers translation facilities in several languages. However, additional translation costs may apply and the process may take longer if the documents are provided in a language other than English.

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 (for CBF customers using CreationOnline), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.