Quick refund - eligibility, documentation, deadlines - Hungarian equities

01.01.2016

Who can apply for a quick refund?

Quick refund of withholding tax on dividends from Hungarian equities is available through Clearstream Banking for the following eligible beneficial owners (who have not benefit from relief at source):

Eligible beneficial owners

Effective tax rate after refund

Tax refund available

Legal entities not resident in Hungary

0%

15%

Legal entities resident in Hungary

0%

15%

We remind our customers that quick refund is available only if the issuer agrees to potentially revise his declaration towards the HTA. Should the issuer not offer such possibility, Clearstream Banking will inform customers before the respective income event via SWIFT/CreationOnline message.

Note: Clearstream Banking can give no guarantees with regard to the quick refund procedure as it is based on market practice and all applications depend on the good will of the paying agent. Although Clearstream Banking will assist customers with quick refund applications, it can remit to customers' accounts only the amounts that it receives.

Documentation requirements

To apply for a quick refund of withholding tax on dividends from Hungarian equities, customers must submit to Clearstream Banking a revised List of Beneficial Owners, uploaded electronically via the BO Upload facility under “Applications” on the Clearstream Banking website.

Legal entities do not need to be disclosed, only the payment details and the breakdown of positions (according to the final beneficial owners' status and residency) should be filled in as such:

  • The total number of shares held by the customer (the same as the number submitted at source);
  • The total number of shares held by non-resident legal entities (revised);
  • The total number of shares held by Hungarian legal entities (revised);
  • The total number of shares held by disclosed DTT resident individuals (the same as the one submitted at source);
  • The total number of shares held by undisclosed holders (revised).

Note: For legal entities, no further documentation needs to be provided, unless required by the issuer and/or the Hungarian Tax Authorities.

Deadline for receipt of documents

Upon the confirmation of the quick refund applicability, the Revised List of Beneficial Owners must be received by Clearstream Banking at the latest by 10:00 CET on 15 December of the year in which the dividend payment took place.

When are quick refunds received?

The estimated time for receiving a quick tax refund is between two weeks and two months from the date of receipt of the revised tax breakdown by the Hungarian issuer.