Italy: Reminder: Annual renewal of Certificate of Residence (revised - 11% rate reintroduced)

In order to obtain relief at source on dividends from Italian equities paid during the period 1 April 2012 to 31 March 2013, customers must ensure that Clearstream Banking¹ receives renewed Certificates of Residence for eligible beneficial owners no later than

16 March 2012

The validity of the Certificates of Residence that we currently hold for non-resident beneficial owners eligible to obtain tax relief on dividends paid for Italian equities will expire on 31 March 2012.

As of 1 January 2012, reduced tax rates are available as indicated for final beneficial owners who comply with the following eligibility criteria:

• 1.375%:
  
  Provided that, according to Circular 32/E 2011:
  
  
  • The final recipient of the dividend is resident in a European Union (EU) member state or European Economic Area (EEA) country and is subject to corporation tax in its country of residence; and
    
  • The beneficiary/dividend distribution setup is not part of a “tax avoidance mechanism”.

• 11%:
  
  Provided that the recipient of the dividend is:
  
  
  • An entity that is established as a pension fund; and
    
  • Resident for tax purposes in an EU member state or in an EEA country included in the "white list" published by the Italian Tax Authorities.
  
  
• Treaty rate:
  
  Provided that the final recipient of the dividend 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 Italy.

Validity criteria for Certificate of Residence

A Certificate of Residence issued by the beneficial owner’s local tax authority will be accepted, provided that it certifies the beneficial owner's full name, address and Tax ID (if available) and certifies that the beneficial owner:

• Is subject to direct taxation in its country of residence;
  
• Is resident in accordance with Article 4 of the DTT between its country of residence and Italy; and
  
• (In order to obtain the 1.375% reduced tax rate) is subject to corporate tax in its country of residence; or
  
• (In order to obtain the 11% reduced tax rate) is established as a pension fund.

Note: This information is mandatory (see the attached form to use).

The Certificate of Residence must be signed and stamped by the respective beneficial owner’s local tax authority on or after 1 January 2012 and received at Clearstream Banking no later than 16 March 2012.

Submitting the documents

Customers are reminded that an original of each completed Certificate of Residence must be sent, together with an accompanying letter, mentioning, as mandatory details, the customer account number and the Tax Identification Number (TIN) of each beneficial owner, which must be identical to the TIN included in the One-Time Master Instruction (OTMI) already provided by the respective beneficial owner.

The Certificate of Residence (with the accompanying letter) must be sent to the following address:

Clearstream Banking S.A.
Attn: OTL – Italian Tax
42, avenue JF Kennedy
L-1855 Luxembourg
Luxembourg

Important reminder

If, for any dividend payment date, the following documentation is not in place by the prescribed deadline, the maximum 20% tax rate will be applied:

• The new One-Time Master Instruction (OTMI), correctly completed and signed; and
  
• A renewed annual Certificate of Residence; and, if applicable,
  
• The per-payment List of Beneficial Owners for Italian equities (via the Upload BO list function).

Further information

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

or Clearstream Banking Customer Service or your Relationship Officer.

1. 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).