Netherlands: Specific Certificate of Tax Residence required from Japanese pension funds to benefit from treaty exemption on dividends
Japanese pension funds claiming full tax refund on Dutch dividends, based on Double Taxation Treaty (DTT) provisions, have to submit a Certificate of Tax Residence (COTR) in which a specific wording and reference to the applicable law is mentioned.
Impact on customers
Japanese pension funds wishing to obtain a full tax exemption on dividends from Dutch equities through the standard refund must submit to Clearstream Banking1, by the prescribed deadline, a COTR clearly stating the following wording and the law the pension fund is subject to (listed below):
"With reference to sub paragraph m) of paragraph 1 of Article 3 of the Convention, it is understood that the term “pension fund” includes the following and any identical or substantially similar funds which are established pursuant to legislation introduced after the date of signature of the Convention:
- National Pension Law (Law No. 141 of 1959);
- Employees’ Pension Insurance Law (Law No. 115 of 1954);
- The Law Concerning Mutual Aid Association for National Public Officials (Law No. 128 of 1958);
- The Law Concerning Mutual Aid Association for Local Public Officials and Personnel of Similar Status (Law No. 152 of 1962);
- The Law Concerning Mutual Aid for Private School Personnel (Law No. 245 of 1953);
- Coal-Mining Pension Fund Law (Law No. 135 of 1967);
- Defined-Benefit Corporate Pension Law (Law No. 50 of 2001);
- Defined-Contribution Pension Law (Law No. 88 of 2001);
- Farmers’ Pension Fund Law (Law No. 127 of 2002);
- Corporate Tax Law (Law No. 34 of 1965);
- Small and Medium Enterprises Retirement Allowance Mutual Aid Law (LawNo. 160 of 1959);
- Small Enterprise Mutual Relief Projects Law (Law No. 102 of 1965); and
- Cabinet Order of Income Tax Law (Cabinet Order No. 96 of 1965)."
Important: Japanese pension funds submitting a COTR with the standard wording will only be eligible to a 5% tax refund, as per article 10(2)(b) of the DTT signed between The Netherlands and Japan
Customers are reminded that the standard refund process has changed due to the electronic filing implemented in 2016 by the Dutch Tax Authorities. Refer to our announcement A16143, dated 28 September 2016, and to our Market Taxation Guide – Netherlands for further details on our Standard refund procedure and deadlines.
For further information, please contact the Clearstream Banking Tax Help Desk, Clearstream Banking Client Services or your Relationship Officer.
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 Clearstream Banking Frankfurt 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.