Standard refund - eligibility, documentation, deadlines - Austrian equities
Who can apply for a standard refund?
A reclaim of withholding tax on dividends from Austrian equities is available if the beneficial owner qualifies for the benefit of a reduced rate of withholding tax in accordance with a Double Taxation Treaty (DTT) between its country of residence and Austria or qualifies for exemption from withholding tax in accordance with §§6 or 21 of the Austrian Corporate Income Tax Act (ACITA - "Körperschaftsteuergesetz").
A customer can reclaim withholding tax on behalf of an eligible beneficial owner through Clearstream Banking by submitting the appropriate required documentation and follow the procedure with electronic pre-notification on Austrian Tax Authority online portal.
Residents of Austria cannot reclaim withholding tax through Clearstream Banking.
| Eligible beneficial owners | Effective rate of tax after refund a | Tax refund available a |
Residents of Double Taxation Treaty (DTT) countries | Tax treaty rate or 27.5%, whichever is lower | 27.5% minus the tax treat rate b |
a. Expressed as a percentage of the gross dividend amount.
b. Amount of relief will be 0% if the DTT rate exceeds 27.5%%.
Documentation requirements
For reclaims through Clearstream Banking of tax withheld on Austrian securities by or on behalf of beneficial owners who are not foreign investment funds, documents must be completed and submitted as follows:
- Form ZS-RD-DIAG ;
- Power of Attorney;
- Credit Advice;
- Letter of Request to Clearstream Banking for Reclaim of Austrian Withholding Tax.
Note: The ZS-RD-DIAG / Web-Form DIAG forms are available from the Austrian government website (enter DIAG in the search field, as appropriate). In the names of the forms, "Englisch" or without additional specification, indicate German- and English-language versions respectively.
For such reclaims by or on behalf of foreign investment funds, documents must be completed and submitted according to the constitution of the fund's investor base, as follows:
- Funds with 100 or more investors all of which hold less than 10% of the fund:
- Claim for Repayment from the foreign investment fund company;
- Declaration of Widely Held Foreign Investment Funds, indicating the percentage of units held by investors entitled to the benefits of a Double Tax Treaty (DTT) with Austria (“good investors”).
- Funds with 100 or more investors some of which hold 10% or more of the fund ("good" investors):
- Claim for Repayment from the foreign investment fund company;
- Declaration of Widely Held Foreign Investment Funds, indicating the percentage of units held by good investors;
- Certificate of Residence for each investor holding 10% or more of the fund.
- Funds with 10-99 investors:
- Claim for Repayment from the foreign investment fund company;
- Certificate of Residence for each investor, regardless of holding percentage.
- Funds with 1-9 investors:
- Claim for Repayment from each investor, not from the foreign investment fund company.
For example: If each of two investors in an investment fund of 1000 shares holds 50% (500 shares), the Austrian Tax Authorities will require:- An individual Claim for Repayment from each investor, each regarding a 50% holding;
- Proof of the full 100% dividend and a Declaration of Widely Held Foreign Investment Funds from the investment funds company.
- Claim for Repayment from each investor, not from the foreign investment fund company.
Note: All credit advices must be signed and stamped and must be submitted in the original; the Austrian Tax Authorities will no longer accept copies. Each reclaim application must include a Declaration of Widely Held Foreign Investment Funds but, based on information from the Austrian Tax Authorities, such Declaration can be provided annually in the original and copies can be used for each refund thereafter.
Additional documentation requirements
As defined in §§6 or 21 of the Austrian Corporate Income Tax Act (ACITA), foreign pension funds and legal entities are entitled to a full tax refund provided that they have the same status as comparable Austrian entities.
For EU/EEA pension funds:
According to ACITA §6, customers can submit the following refund documentation:
- Reclaim forms ZS-RD-DIAG / Web-Form DIAG, in which it is stated in chapter “General data” under “legal basis” that the reclaim is in accordance with ACITA §6. Customers can certify their residence directly on the form.
- Dividend payment advice.
- Approval of registration of the pension fund, according to EU-Directive 2003/41/EC, issued by the authorised supervising authority in the country of residence of the pension fund. Customers must provide this for each business year.
- Copy of the articles of incorporation of the pension fund, confirming that the pensions granted by the pension fund do not exceed 80% of the beneficiary’s last salary.
For EU/EEA legal entities:
According to ACITA §21, customers can submit the following refund documentation:
- Reclaim forms ZS-RD-DIAG / Web-Form DIAG, in which it is stated that the reclaim is in accordance with ACITA §21 in chapter “General data” under “legal basis”. Customers can certify their residence directly on the form.
- Dividend payment advice.
- Confirmation from the local tax authorities that, because of local legislation, the beneficial owner was unable to credit the Austrian tax in their country of residence. The confirmation must show the beneficial owner’s tax ID and be issued separately for each business year.
The statute of limitations for reclaims is five years.
Notes:
The Austrian Tax Authorities may ask for authenticated translations of required documents that were submitted in languages other than German or English and may request confirmation of tax reclaims based on Double Taxation Treaties (DTTs).
Customers must state, on their application, whether the application will be initiated according to ACITA §§6 and 21. In the absence of such indication and using legal basis “due to the Austrian double-taxation agreement”, the Austrian Tax Authorities will process the submitted application in accordance with a DTT between the beneficial owner's country of residence and Austria.
Statutory deadline for reclaiming withholding tax
The statutory deadline for reclaiming withholding tax is five years following the year in which the relevant dividend payment, for which tax reclaim is to be made, occurred. This statutory deadline overrides the regulations mentioned in all existing Double Taxation Treaties (DTTs).
As an exception, the statutory deadline for reclaiming withholding tax for German resident beneficial owners is four years after the end of the calendar year in which the dividend was paid.
Clearstream deadline for standard refund applications
The deadline by which Clearstream Banking must receive the documentation for a standard refund application is at least two months before the statutory deadline. All standard refund applications received after this deadline will be processed by Clearstream Banking on a "best efforts" basis. However, in such a case, Clearstream Banking will apply an extra charge and accepts no responsibility for forms that have not reached the Austrian Tax Authorities by the date considered as being the statute of limitations deadline.
Note: Missing documents must be forwarded immediately after the notification by the Austrian Tax Authorities; otherwise, the claim may be rejected.
Notes on tax reclaims
Customers warrant the completeness and accuracy of the information they supply to Clearstream Banking.
It is the customer's responsibility to determine any entitlement to a refund of tax withheld, to complete the forms required correctly and to calculate the amount due. Clearstream Banking is under no obligation to carry out any investigation in respect of such information.
Customers must state, either on their application, whether the application is:
- Initiated according to §6 (for EU Pension Funds) or §21 (for foreign legal entities/corporate bodies “Körperschaften”) of the Austrian Corporate Income Tax Act (ACITA - "Körperschaftsteuergesetz") in chapter “General data” under “legal basis”; or
- Submitted in accordance with a DTT between the beneficial owner's country of residence and Austria in chapter “General data” under “legal basis”.
With respect to tax reclaims in general, customers are reminded that Clearstream Banking accepts no responsibility for their acceptance or non-acceptance by the tax authorities of the respective country.
Details regarding legal basis, type of reclaim and usage of reclaim forms are available on ATA website, but currently only available in German.
Beneficial ownership in respect of justified reclaim
In September 2014, the Austrian Tax Authority (ATA) answered open questions regarding the transfer of beneficial ownership in the event of disposals with cum/ex-aspects and clarified who is allowed to reclaim tax on so called cum/ex transactions.
The letter “Information on Capital Yields Tax Refunds for Dividends Received by Taxpayers with Limited Tax Liability (Non-Resident Taxpayers)” can be found on the ATA’s website and in English at the following link.
Applicants are entitled to reclaim tax when their positions were settled and booked on their account before the dividend entitlement date. Reclaims on compensated Market Claims will be rejected by the ATA.
Tax on compensated Market Claims, so called cum/ex transactions, can be reclaimed by the buyer only against and via the settled position on dividend entitlement date of its counterparty (seller).
Confirmation on tax reclaims
Since summer 2015, the ATA has been informing applicants about tax reclaim payments via the “Stattgabe-Bescheide“.
The detailed payment confirmation from ATA is forwarded to the applicant, or its representative (if any), when the mandate for postal deliveries is ticked under section 2 “Information about representative, if applicable” on reclaim form ZS-RD-DIAG / Web-Form DIAG.
If customers do not enter Clearstream Banking as a representative and do not tick the mandate for postal deliveries, Clearstream Banking will not be informed about payment details and cannot monitor the settlement of the payments.
Filling reclaim form
Applicants cannot file the reclaim application form before the end of the year in which the tax was withheld (for example, not before 2016 for dividends paid in 2015).
In addition, the ATA also stated that from a procedural point of view the ATA would require only one single reclaim application form per year and per applicant/beneficial owner.
Note: If the applicant uses the Clearstream Banking tax service it is mandatory to tick type of authorisation “Financial authorisation” and “Recipient authorisation” and enter in addition in section 2 “Information about representative, if applicable” the following address in Form ZS-RD-DIAG / Web-Form DIAG”.
Clearstream Operations Prague s.r.o..
Attn: PTS - Tax Services
Futurama Business Park Building B
Sokolovska 662/136b
CZ-18600 Prague 8
Czech Republic
and in section 5 “Details for the transfer of the repayment amount (banking information)” the following details:
- IBAN (International Bank Account Number): AT802010040331637800
- Account holder: Clearstream Banking S.A. Luxembourg
- Financial institution: Erste Group Bank AG
- BIC (Bank Identifier Code): GIBAATWGXXX
- Address (financial institution): Am Belvedere 1, 1100 Wien, Austria
Note: Clearstream Banking would like to inform customers that the answers given by applicant on Web-Form “DIAG”to questions on chapter 6A “General Information” on form ZS-RD-DIAG / Web-Form DIAG” cannot be validated and Clearstream Banking recommends that applicants answer all questions and do not delete any sentences and/or sections. Reclaim forms will be forwarded by Clearstream Banking even if parts of the questions have not been answered by the applicant.
When are refunds received?
The estimated time for receiving a refund is four months from the date of receipt by the Austrian Tax Authorities, although this can vary depending on when the application is filed and the complexity of the information supplied in the reclaim form.
Clearstream Banking has collected information from sources considered reliable but does not guarantee the accuracy of the timings presented.