Beneficial owners - Icelandic debt securities
The following types of beneficial owner are recognised for tax purposes in Iceland:
- Residents of a DTT country
- Non-resident beneficial owners
- Tax-exempt entities
- Icelandic banks complying with Article 3.2 of Act no 94/1996
- Icelandic beneficial owners
Debt securities exempt from non-resident taxation - withholding and capital gains tax
Debt securities falling under scope of Article 1 of Act. no. 39/ 2013, Article 1 of Act no. 53/2014 and Article 1 of Act no. 107/2015 (exemption from non-resident taxation of interest).
Non-resident beneficial owners
Beneficial owners that are non-residents of Iceland benefit from a 0% reduced tax rate on interest payments and gains realised on transactions from Icelandic debt securities.
Clearstream Banking customers that are Icelandic banks complying with Article 3.2 of Act no. 94/1996
Clearstream Banking customers that are Icelandic banks complying with Article 3.2 of Act no. 94/1996 benefit from a 0% reduced tax rate on interest payments and gains realised on transactions from Icelandic debt securities.
Note: Such entities are considered as Icelandic tax withholding agents, implying they must withhold the appropriate tax amounts from their respective clients.
Other debt securities (not exempt from non-resident taxation) - withholding and capital gains tax
Non-resident beneficial owners
Non-resident beneficial owners that are residents in a country which has not signed a DTT with Iceland benefit from the 0% withholding/capital gains tax on payments and gains realised on transactions from Icelandic debt securities.
However, even if there is no withholding or capital tax withheld through Clearstream Banking on taxable debt securities held in Clearstream Banking, withholding and capital gain tax may still be payable on interest and capital gains. Clearstream Banking does not assist in this regard. Please consult your tax advisor for full information.
Residents of Double Taxation Treaty (DTT) countries
Beneficial owners that are residents in a country which has signed a DTT with Iceland benefit from 0% withholding/capital gains tax on interest, payments and gains that are derived from Icelandic debt securities through Clearstream Banking.
However, even if there is no withholding or capital tax withheld through Clearstream Banking on taxable debt securities held in Clearstream Banking, withholding and capital gain tax may still be payable on interest and capital gains. Clearstream Banking does not assist in this regard. Please consult your tax advisor for full information.
Tax-exempt entities
The tax-exempt beneficial owners mentioned below may benefit from a tax exemption on interests, payments and gains that are derived from Icelandic debt securities through Clearstream Banking.
However, even if there is no withholding or capital tax withheld through Clearstream Banking on taxable debt securities held in Clearstream Banking, withholding and capital gain tax may still be payable on interest and capital gains. Clearstream Banking does not assist in this regard. Please consult your tax advisor for full information.
Clearstream Banking customers that are Icelandic Banks complying with Article 3.2 of Act no. 94/1996
Clearstream Banking customers that are Icelandic Banks complying with Article 3.2 of Act no. 94/1996 benefit from a 0% reduced tax rate on interest payments and gains that are derived from Icelandic debt securities through Clearstream Banking.
Note: Such entities are considered as Icelandic tax withholding agents, implying that they must retain the appropriate tax amounts from their respective clients.
Icelandic residents
Positions that are held on behalf of Icelandic beneficial owners, may not be held via Clearstream Banking, unless held via a Clearstream Banking customer, that is an Icelandic intermediary bank complying with Article 3.2 of Act no. 94/1996.