Beneficial owners - Irish equities
The following types of beneficial owners are entitled to a withholding tax exemption/reduced withholding tax rate on dividends from Irish equities:
- Qualifying non-resident persons: beneficial owners that qualify as non-resident persons may benefit from a tax exemption on dividends paid from Irish equities (either at source if they are the direct customers of Clearstream Banking or via the standard refund procedure).
According to “The Dividend Withholding Tax Technical Guidance Notes” published on the Irish Revenue Commissioners website, the following categories of beneficiaries are considered as being qualifying non-resident persons:
- An unincorporated body of persons, such as a charity or superannuation fund, which is resident for the purposes of tax in a relevant territory2,
- Individuals who are neither resident nor ordinarily resident in the State but are resident for the purposes of tax in a relevant territory2,
- Companies resident for the purposes of tax in a relevant territory2 and which are not controlled by Irish residents,
- Companies that are not resident in the State which are under the ultimate control of persons who are neither resident nor ordinarily resident in the State, but are resident for the purposes of tax in a relevant territory2,
- Companies, the principal class of shares of which, or (of a company of which it is at least a 75 per cent subsidiary) is substantially and regularly traded on a recognised stock exchange in a relevant territory2,
- Companies which are wholly owned by two or more companies, each of whose principal class of shares are substantially and regularly traded on one or more recognised stock exchanges in a relevant territory2.
- Excluded Irish persons: beneficial owners that are the direct customers of Clearstream Banking and that qualify as excluded Irish persons may benefit from a tax exemption at source on dividends paid from Irish equities.
According to “The Dividend Withholding Tax Technical Guidance Notes” published on the Irish Revenue Commissioners website, the following main categories of beneficiaries are considered as being excluded Irish persons:
- A company resident in the State,
- A pension scheme, which is an exempt approved scheme within the meaning of section 774 or a retirement annuity contract or trust scheme to which sections 784 and 785 apply,
- A qualifying employee share ownership trust, which has been approved by Revenue,
- A collective investment undertaking within the meaning of section 734, an undertaking for collective investment within the meaning of 738, and an investment undertaking within the meaning of section 739B. However, if any such undertaking is also an offshore fund within the meaning of section 743, the exemption does not apply,
- A charity, which has been granted exemption from tax by Revenue,
- An amateur or athletic sports body which has been granted an exemption from tax by Revenue,
- A designated broker receiving relevant distributions as all or a part of the relevant income or gains of a Special Portfolio Investment Account (SPIA),
- A qualifying fund manager who is receiving relevant distributions as income arising in respect of assets held in an approved retirement fund (ARF) within the meaning of section 784A or in an approved minimum retirement fund (AMRF) within the meaning of section 784C.
- Irish Exempt Unit trusts within the meaning of Section 731(5)(a) TCA.
- Irish Person Retirement Savings Account administrators.
Note: Clearstream Banking does not provide any tax relief with regards to the distributions from property profits by Irish REITs. Such distributions are subject to standard Irish withholding tax. Standard refund procedure may be available for residents of Double Taxation Treaty countries.
- Residents of Double Taxation Treaty (DTT) countries: beneficial owners that are residents in a country which has signed a DTT with Ireland may benefit from a reduced tax rate on dividends from Irish equities via the standard refund procedure.
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1. “Relevant territory” refers to a Member State of the European Union other than Ireland or, not being such a Member State, a country with which Ireland has a double taxation treaty.