Immediate refund - eligibility, documentation, deadlines - Spanish debt securities (securities held in CBF)

30.10.2020

Who can obtain an immediate refund?

Immediate refund of withholding tax on interest from Spanish debt securities is available through Clearstream Banking for beneficial owners depending on the type of the domestic Spanish debt securities as follows:

1. Domestic bonds subject to RD 1145/2011

Eligible beneficial ownersRate applicable at source

Non-residents of Spain

0%

Supranational organisations recognised by Spanish law

0%

Spanish resident corporate income tax payers

0%

2. Domestic corporate bonds not subject to RD 1145/2011

Eligible beneficial ownersRate applicable at source

Residents of Double Taxation Treaty countries

19% minus the treaty rate

Residents of EU/EEA member countries (not Spain)

0%

Foreign central banks

0%

Supranational organisations recognised by Spanish law

0%

Spanish resident corporate income tax payers holding corporate bonds issued after 1 January 1999

0%

Documentation requirements

There are different documentation requirements depending on the status of the beneficial owner and on the type of the domestic Spanish debt securities.

1. Domestic bonds subject to RD 1145/2011

  • All customers holding such bonds must submit, before the first impacted interest payment:
    • One-Time Certificate for Domestic Spanish Debt Securities.
  • Customers holding such bonds on behalf of beneficial owners who are eligible for tax exemption but also on behalf of beneficial owners that are Spanish individuals or are not willing to disclose their positions must submit, in addition to the One-Time Certificate and before each impacted interest payment:
    • Breakdown of Holdings via SWIFT formatted MT565 message, CreationOnline or Xact Web Portal message (Please refer to the Customer Handbook for full formatting requirements), indicating:  
      • Customer account number;
      • ISIN code;
      • Event Corp ID;
      • Instructed quantity (according to the eligible balance in the account);
      • Tax rate to apply: to be included in field :92A::TAXB// for SWIFT users or tax rate field for CreationOnline and Xact Web Portal users;
      • Wording, as applicable: “non-Spanish residents” or “Spanish residents”; Note, instructions submitted for Spanish residents without disclosure provided via SWIFT or list of Spanish entities (LBO) will be rejected.
      • Customer’s full contact details.
        Note: The default tax rate will be applied to uninstructed (undisclosed) holdings.
  • Customers holding such bonds on behalf of beneficial owners that are Spanish residents must submit, in addition to the One-Time Certificate and, where applicable, the Breakdown of Holdings, before each impacted interest payment:
    • List of Spanish Entities.

2. Domestic corporate bonds not subject to RD 1145/2011

  • Beneficial owners resident in a DTT country or in an EU/EEA member country other than Spain and not resident in a tax haven or retrieving the income through an intermediary in a tax must submit:
    • Annual certificate of residence per beneficial owner issued by the local tax authorities of the beneficial owner; it is recommended to provide this form double-sided; and
    • List of beneficial owners per payment with the name, address and holding of the beneficial owners.
  • Spanish resident corporate income tax payers holding corporate bonds issued after 1 January 1999 must submit:
    • List of beneficial owners per payment with the name, address, fiscal ID and holding of the Spanish corporations

3. Supranational organisations

If the beneficial owner is a supranational organisation recognised by Spanish law, the following documentation must be submitted:

  • A Swift message with the name, address, the applicable rate of withholding tax, the nominal holding and the net tax amount to be refunded for each final beneficial owner being a supranational organisation;

and, if applicable:

  • A copy of the “Convenio Constitutivo” confirming tax-exempt status.

Direct supranational customers of Clearstream Banking who want to obtain tax exemption on interest from Spanish domestic debt securities may apply for a standing instruction provided that the customer:

  • Has the status of a supranational organisation; and
  • Holds the Spanish securities for itself as sole beneficial owner; and
  • Submits the required certification to Clearstream Banking by the deadlines set for the respective income payment.

The documentation requirements vary depending on whether the supranational organisation:

  • Is included in the “consultation” list confirmed by the Spanish Tax Authorities; or
  • Has signed a “Convenio Constitutivo” with Spain.

Tax-exemption as per “consultation” list

For the standing instruction, the customer is required to submit, once and before the first income payment, the following documentation:

  • Spanish Securities - Standing Instruction for International or Supranational Organisations and Central Banks certifying, among other things, that the customer holds the Spanish securities exclusively as proprietary assets.

    Note: The “consultation” list is not exhaustive. It includes a certain number of entities for which the Spanish Tax Authorities have confirmed tax-exempt status, not all supranational organisations recognised by Spanish law.

Tax-exemption based on a “Convenio Constitutivo”

For the standing instruction, the customer is required to submit, once and before the first income payment or quick refund application, the following documentation:

  • Spanish Securities - Standing Instruction for International or Supranational Organisations and Central Banks certifying, among other things, that the customer holds the Spanish securities exclusively as proprietary assets; and
  • A copy of the “Convenio Constitutivo” confirming tax-exempt status.

4. Foreign central banks

If the beneficial owner is a foreign central bank, the following documentation must be submitted:

  • A Swift message with the name, address, the applicable rate of withholding tax, the nominal holding and the net tax amount to be refunded for each final beneficial owner being a central bank (not in Spain);

and, upon request:

  • A copy of the By-laws or any other official document proving central bank status.

Direct foreign central bank customers of Clearstream Banking who want to obtain tax exemption on interest from Spanish domestic debt securities may apply for a standing instruction provided that the customer:

  • Has the status of a central bank (not in Spain); and
  • Holds the Spanish securities for itself as sole beneficial owner; and
  • Submits the required certification to Clearstream Banking by the deadlines set for the respective income payment.

For the standing instruction, the customer is required to submit, once and before the first income payment, the following documentation:

  • Spanish Securities - Standing Instruction for International or Supranational Organisations and Central Banks certifying, among other things, that the customer holds the Spanish securities exclusively as proprietary assets; and, upon request:
  • A copy of the By-laws or any other official document proving central bank status.

Form descriptions are presented according to the procedures available for relief and/or reclaim of withholding tax on income from Spanish debt securities.

Deadlines for receipt of documents

Documentation for immediate refund of withholding tax on interest from Spanish debt securities must be received by Clearstream Banking by the following deadlines, depending on the different paying agents:

Type of securityDeadline for receipt by
Clearstream Banking

Government bonds and public debt income paid by Bank of Spain

At least one business day before the respective payment, by 10:00 CET.

Generalitat de Catalunya Bonds income paid by Bolsa Barcelona

At least one business day before the respective payment, by 10:00 CET.

Basque bonds income paid by Bolsa Bilbao

At least one business day before the respective payment, by 10:00 CET.

Generalitat Valenciana Bonds income paid by Bolsa Valenciana

At least one business day before the respective payment, by 10:00 CET.

Corporate bonds subject to RD 1145/2011 income processed by BBVA

At least one business day before the respective payment, by 10:00 CET.

Corporate bonds not subject to RD 1145/2011 income processed by BBVA

At least two business days before the respective payment, by 10:00 CET.

Important note:

If any instruction, tax certification or amendment is received after these deadlines, the customer’s entire application for immediate refund will be rejected, with the possibility to be processed via the quick refund.