Relief at source - eligibility, documentation, deadlines - Hungarian equities
Who can obtain relief at source?
Tax relief at source on dividends from Hungarian equities is available through Clearstream Banking for the following beneficial owners:
Eligible beneficial owners
Rate applicable at source
Individuals resident of Double Taxation Treaty (DTT) countries
Legal entities not resident in Hungary
Legal entities resident in Hungary
The documentation requirements are described below and the templates of the forms are available on our Tax Forms to use section.
All beneficial owners regardless their residency and status and applying for relief at source on Hungarian equities:
- One-Time Certificate for dividend payments on Hungarian equities
An original One-Time Certificate should be duly completed and signed by Clearstream’s customer. It specifies, among other things, whether the customer is the sole beneficial owner of all the Hungarian securities held in the account.
The document must be provided once before the first dividend payment and remains valid until revoked. However, any changes to any details must be communicated in a new One-Time Certificate.
- Per-payment instruction
From 25 January 2022 onwards, the list of beneficial owners is replaced by a per-payment instruction,per each tax rate required, provided via swift (formatted MT565), or Xact Web Portal message (please refer to the Customer Handbook or Xact via SWIFT User Guide for full formatting requirements), and containing all mandatory information per beneficiary status and residency.
In addition, by private individual residents in a DTT country:
- Certificate of residence
An original Certificate of Residence should be issued in English by the beneficial owner’s local tax authorities in the year for which it is to be used.
The document is valid from the date of the signature until the end of the respective calendar year.
- Declaration of beneficial ownership
An original declaration of beneficial ownership should be completed and signed by the beneficial owner, if it is requested by the applicable DTT.
The document must be provided for each relief at source application.
Deadlines for receipt of documents
To benefit from relief at source, eligible beneficial owners should provide the required documentation with the below prescribed deadlines. If any instruction, tax certification or amendment is received after these deadlines, the customer’s entire application for relief at source will be rejected.
At the latest on record date by 10:00 CET.
At the latest by 18:00 CET two business days before the record date of the first dividend payment to which it applies or before each dividend payment, depending on the validity of the document.