Relief at source – eligibility, documentation, deadlines – Italian debt securities
Who can obtain relief at source?
Relief at source from withholding tax on interest from Italian debt securities is available through Clearstream Banking for beneficial owners as follows:
| Eligible beneficial owners | Rate applicable at source |
Residents of a White List country | 0% |
Supranational organisations recognised by Italian law | 0% |
Central banks or other entities that manage state reserves | 0% |
Italian resident corporations | 0% |
Italian clients, provided that they have submitted the required documentation, are paid gross the interest on securities held for themselves or for underlying beneficial owners.
Account opening pre-requisite
To obtain exemption, the Italian debt securities must be settled on an exempt account. Clients have the possibility to open two types of exempt account:
- Account type “S”: Segregated account fully exempted, TIN is not required
- Account type “X”: Omnibus account fully exempted, TIN is mandatory at settlement instruction level. If not or incorrectly provided the instruction is rejected. Refer to page Overall process for tax calculation/exemption from withholding tax - Italian debt securities for more details.
Documentation requirements
There are different documentation requirements depending on the status of the beneficial owner or client.
- When the beneficial owner is:
- A resident of a “white list” country:
- Master Instruction;
- Self Certification;
- Side Declaration, if applicable.
- The European Central Bank (ECB) and central banks members of the European System of Central Banks (ESCB):
- Master Instruction;
- Documentary evidence that they are effectively a central bank (for example, copy of statutes).
- An other central bank or entity that manages state reserves:
- Master Instruction;
- Self Certification for central banks and supranational organisations.
- Documentary evidence that they are effectively a central bank (for example, copy of statutes).
- A resident of a “white list” country:
- A supranational organisation recognised by the Italian law:
- Master Instruction;
- Self Certification for central banks and supranational organisations.
When the beneficial owner is Italian:
- An Italian resident corporation, direct client of Clearstream:
- Master Instruction.
- Letter of Indemnity from an Italian Beneficial Owner - Italian Bonds.
- An Italian bank, fiduciary or financial institution (company) and is the direct client of CBL non-Italian client:
The Italian bank/fiduciary must be the next intermediary after the CBL direct client. It is mandatory to segregate the position of the Italian bank/fiduciary and to reflect the name of the Italian bank next to the name of the client in the CBL account denomination.
- Letter of Indemnity from a Non-Italian Client – Italian Bonds
and
- Letter of Indemnity from an Italian bank - Italian bonds, or Letter of Indemnity from an Italian Fiduciary Company – Italian bonds or Letter of Indemnity from an Italian Company – Italian Bonds
Form descriptions are presented according to the procedures available for relief and/or reclaim of withholding tax on income from Italian debt securities.
Deadlines for receipt of documents
Documentation for relief at source from withholding tax on interest from Italian debt securities must be received by Clearstream Banking by the following deadlines:
| Document | Deadline for receipt by Clearstream Banking |
Master Instruction | Before changing the account tax status from taxable to exempt; or Upon changes to the list of beneficial owners. |
Self Certification | Before applying for tax exemption. |
Side Declaration | Before applying for tax exemption. |
| Letter of Indemnity from an Italian Client - Italian Bonds (Letter of Indemnity #1) | Before applying for tax exemption. |
| Letter of Indemnity from an Italian Beneficial Owner - Italian Bonds (Letter of Indemnity #2) | Before applying for tax exemption. |