General information - types of securities, deadlines, other market specifics - Japan
Types of securities eligible in Clearstream Banking
The eligible securities issued in Japan are as follows:
Debt securities:
- Japanese Government Bonds (JGBs), including Discount Japanese Government Bonds (DJGBs) and Discount Japanese Local Government Bonds (DJLGBs);
- Japanese corporate and municipal bonds, including Discount Japanese Corporate Bonds;
- Foreign bonds (Samurai);
- Japanese Convertible Bonds (JCBs);
- Japanese Eurobonds.
Note: Discount bonds include the following:
- Discount bonds without fixed interest payments;
- Principal or interest portions as a result of a split of strips;
- Deep discount bonds (interest-bearing bonds whose issue value is less than 90% of redemption value).
Equities:
- Listed equities;
- Un-listed equities;
- Exchange Traded Funds (ETFs) / Real Estate Investment Trusts (REITs);
- Japanese American Deposit Receipts (ADRs).
Note: Japanese Eurobonds and ADRs are issued outside Japan and are therefore not held via Clearstream Banking’s link in Japan.
Types of beneficial owner
The types of eligible beneficial owner recognised for tax purposes in Japan vary according to security type, as follows:
For debt securities:
- Residents of Double Taxation Treaty (DTT) countries;
- Non-residents of Japan;
- Residents of Japan (corporation);
- Designated Financial Institutions (DFIs) resident in Japan;
- Residents of Japan (individual or corporation) for Japanese tax purpose who receives interest payments through a Payment Handling Agent (PHA) in Japan.
For equities:
- Residents of Double Taxation Treaty (DTT) countries;
- Tax-exempt beneficial owners.
Holding restriction
Only tax-exempt beneficial owners may hold Japanese government, corporate and municipal bonds via Clearstream Banking. For these types of securities, beneficial owners that are Japanese resident individuals or corporations (including branches of such corporations, either in Japan or abroad) are not eligible to hold via Clearstream Banking.
Statutory deadline for reclaiming withholding tax
Standard refund of withholding tax is available for eligible beneficial owners with regard to income from JCBs and Japanese listed equities, ETFs and REITs.
The statutory deadline for reclaiming withholding tax on such income is five years after the date on which the income was distributed.
Clearstream deadline for standard refund applications
The deadline by which Clearstream Banking must receive the required documentation is at least three months before the statutory deadline.
We will process all standard refund applications received after this deadline on a “best efforts” basis. However, in such cases, we will apply an extra charge and accept no responsibility for forms that have not reached the Japanese Tax Authorities by the date considered as being the statute of limitations deadline.
When are refunds received?
The estimated time for receiving a refund from a standard refund application is generally within six months from the date of receipt by the Japanese Tax Authorities. This can vary depending on when the application is filed and the complexity of the information supplied in the reclaim form.
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.
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. 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.