Italy: 11% reduced tax rate reintroduced for EU/EEA pension funds

Following our Announcements A11201, dated 27 December 2011, and A12008, dated 9 January 2012, we hereby provide a further update concerning the new tax rates applicable as of 1 January 2012 and inform that the pension funds resident in EU/EEA countries¹ are again eligible to apply for the 11% reduced tax rate on dividends paid on Italian equities as of 1 January 2012.

Background

Legislative Decree 138, approved by the Italian Parliament on 13 August 2011 and passed into Law 148 of 14 September 2011 (the “Law”), did not specify the possibility for EU/EEA pension funds to benefit from the 11% reduced tax rate.

As a consequence, EU/EEA pension funds were supposed to be taxed, as of 1 January 2012, at 20% on dividends, with the possibility to apply for a lower rate according to a Double Taxation Treaty (DTT) signed between their country of residence and Italy, provided that they comply with the eligibility criteria required by the respective DTT.

The so-called “Decreto liberalizzazioni”, published in Gazzetta Ufficiale no. 19 of 24 January 2012, has reintroduced the possibility for EU/EEA pension funds to apply for the 11% reduced tax rate on dividends paid on Italian equities.

Impact on customers

Final beneficial owners who are EU/EEA pension funds may continue to apply to obtain the 11% reduced tax rate by submitting the following certification:

• One-Time Certificate for Italian Equities (if not already provided);
  
• One-Time Master Instruction (OTMI) (if not already provided);
  
• Certificate of Residence (annual); and
  
• Italian Equities: List of Beneficial Owners (per dividend payment);

These certificates have been revised again in order to reflect the 11% reduced tax rate and the updated versions to be used are now available on our website under Information Centre / Tax / ICSD / Italy /Tax Forms to use.

Furthermore, our Announcement A12008 has been updated to reflect the current complete information related to the request to renew the Certificate of Residence.

Further information

For further information, please contact the Clearstream Banking² Tax Help Desk on:

or Clearstream Banking Customer Service or your Relationship Officer.

1. European Union Member States and European Economic Area countries.
2. Clearstream Banking refers collectively to Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in the Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500 (CBF) and Clearstream Banking, société anonyme, registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Register of Commerce and Companies under number B-9248 (CBL).