Equities - rates, eligibility, availability of relief etc. - Italy

29.07.2021

Withholding Tax

Standard rate of withholding tax:0% / 26% aHolding requirements / restrictions:

No

a. Applicable from 1 July 2014; before 1 January 2012, the rate was 27% and, between 1 January 2012 and 30 June 2014, the rate was 20%.

The standard rates of withholding tax on dividends from Italian equities are as follows:

  • 26% on ordinary shares, preferred shares, shares of co-operative banks, converted shares, savings shares (on cash, stock and choice dividends);
  • 0% on premium dividends.

Relief at source is available, upon submission of the appropriate documentation to Clearstream Banking by the prescribed deadlines, at the rates indicated provided that the associated criteria are met:

  • Treaty tax rate, if the beneficial owner 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;
  • 1.20%1, if the beneficial owner is:
    • Incorporated as an entity; and
    • Subject to corporate income tax in its country of residency; and
    • Resident in the European Union (EU) or European Economic Area (EEA); that is, listed in the Italian White List currently in force;
  • 11%, if the beneficial owner is:
    • An entity that is established as a pension fund; and
    • Resident for tax purposes in an EU/EEA country included in the White List.
  • 0%, if the beneficial owner:
    • An entity that is established as a a CIV established in accordance with Directive 2009/65/EC of 13 July 2009 of the European Parliament and of the Council (UCITS Directive); or
    • If it is not established with the UCITS Directive, the CIV has a fund manager or managing company subject to regulatory supervision in the foreign country where it is established in accordance with Directive 2011/61/EU of 8 June 2011 of the European Parliament and of the Council (AIMF Directive); and
    • The CIV, which should be incorporated in a  EU member state or EEA country with which Italy has an exchange of information (Norway, Iceland and Liechtenstein).
    • is a supranational organisations recognised by Italian law.

A quick refund of withholding tax is available if relief at source has not been obtained by the beneficial owner eligible for tax relief on dividend payments.

A standard refund of withholding tax is available if the beneficial owner eligible for tax relief on dividend payments did not provide the required certification before the relief at source or quick refund deadlines.

The customer can reclaim withholding tax on behalf of the beneficial owner through Clearstream Banking by submitting the appropriate documentation.

Residents of Italy cannot obtain relief at source or reclaim withholding tax through Clearstream Banking.

Availability of relief

Click on the image for a larger view of the diagram showing the availability of relief at source and/or reclaim of withholding tax on income from Italian equities.

a. For ordinary shares, preferred shares, shares of co-operative banks and converted shares only.

Eligible beneficial ownersRelief at SourceQuick RefundStandard Refund

Residents of a DTT country

Yes

Yes

Yes

EU/EEA corporations

Yes

Yes

Yes

EU/EEA pension funds

Yes

Yes

Yes

EU/EEA collective investment vehicles

Yes

Yes

Yes

Supranational organisations recognised as such by Italian law

Yes

Yes

Yes

a. Standard refund is not available due to missing guidelines from the ITA. 

Disclosure requirements

Local laws and regulations require Clearstream Banking to disclose (to issuers, their agents and the Italian Tax Authorities) information, on dividend payment date, about securities holdings and the identity of the ultimate beneficial owners of securities.

Therefore, customers that hold Italian equities in Clearstream Banking must provide Clearstream Banking with information on the beneficial ownership of these holdings. If a beneficial owner’s identity is undisclosed, the details of the customer may be disclosed by Clearstream Banking to the requestor (the issuer, its agent and/or the Italian Tax Authorities).

Note: The disclosure requirements apply also to premium dividends that are not subject to Italian withholding tax.

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1. 1.375% until 31 December 2016, 1.20% as of 1 January 2017.

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