Russia: Further clarification on new withholding tax rate applicable to certain corporate bonds

24.01.2017

Further to our Announcement A16124, dated 18 August 2016, concerning the decrease of withholding tax rate from 20% to 15% for foreign and Russian legal entities receiving interest from certain corporate bonds1, the National Settlement Depository (NSD) have now published an updated List of General Tax Rates under the Russian Tax Code, which includes the Tax codes that are required to be quoted when instructing for relief at source on interest payments for such beneficial owners on the applicable bonds.

Impact on customers

Following the updated list published by the NSD, customers are requested effective

immediately

to include in the per payment instruction or in the One-Time Certificate for Russian Debt Securities, as applicable, the relevant tax codes, that is:

  • Article Number;
  • Clause of article (paragraph);
  • Sub-clause/Paragraph 

when instructing for relief at source on interest payments from corporate bonds for foreign and Russian legal entities eligible for 15% withholding tax.

Further information

For further information, please contact the Clearstream Banking2 Tax Help Desk, Clearstream Banking Client Services or your Relationship Officer.

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1. Customers should note that:

  • The bond must be issued by a Russian organisation;
  • The bond must be denominated in Russian Rubles (RUB);
  • The bond must be issued between 1 January 2017 and 31 December 2021 (both inclusive);
  • The bond is traded on an established securities market at the date when interest income on such bonds is recognised for tax purposes.

2. 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 Clearstream Banking Frankfurt (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.