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Quick refund - eligibility, documentation, deadlines - Spanish equities

15.08.2019

Who can apply for a quick refund?

A quick refund of withholding tax on dividends from Spanish equities is available through Clearstream Banking for eligible beneficial owners, as follows:

Eligible beneficial owners	Effective rate of tax after refund	Tax refund available ^a
Residents of Double Taxation Treaty (DTT) countries	Tax treaty rate	19% minus the tax treaty rate ^b
Supranational organisations recognised as such by Spanish law	0%	19%

a. Expressed as a percentage of the gross dividend amount.
b. Amount of relief will be 0% if the DTT rate exceeds 19%.

Important note:

In order to recover tax withheld on dividend payments, beneficial owners that are EU/EEA funds/plans or CIVs must file their reclaim applications directly with the Spanish Tax Authorities. As a result, the effective 0% and 1% tax rates cannot be achieved through the quick refund procedure. Consequently, tax withheld on behalf of such final beneficial owners can be recovered as follows:

For a fully reduced effective rate, by means of the standard refund procedure; or
In a two-step process:
- For the difference between the standard and DTT rates, by means of the quick refund procedure; and
- For the remainder, by means of the standard refund procedure.

Documentation requirements

There are different documentation requirements depending on the status and residency of the beneficial owner.

Residents of Double Taxation Treaty (DTT) countries for which there is a “Petición de Reducción”

If the beneficial owner is a resident of Austria, the Netherlands, Sweden or Switzerland, the following documentation must be submitted:

A One-Time Certificate for Spanish Equities for the first quick refund application (if not already provided), completed and duly signed by the Clearstream Banking customer; and
A “Petición de Reducción” (an official tax form), available from the Spanish Tax Authorities or from the customer’s local tax authority, completed by or on behalf of the beneficial owner and its local tax authorities; and
A Power of Attorney (if the customer or a third party is completing the “Petición de Reducción” on behalf of the beneficial owner).
Breakdown of refund
- via a duly completed spreadsheet, password-protected, by email to taxspainrefunds@clearstream.com, with the password and the customer instruction to use the spreadsheet for quick or standard refund sent separately via Xact Web Portal, CreationOnline or SWIFT free-format message.
  The CreationOnline or SWIFT free-format message must, in either case, include the following details:
  Attention: PTS Tax Services
  Market: Spain
  Type of refund: Quick or Standard
  Please find hereafter the password to open our breakdown spreadsheet sent to your attention by email on (date and time) from the email address (email address of the sender)
  Password:

Residents of DTT countries that have no “Petición de Reducción”

If the beneficial owner is a resident of a DTT country for which there is no “Petición de Reducción”, the following documentation must be submitted:

A One-Time Certificate for Spanish Equities for the first quick refund application (if not already provided), completed and duly signed by the Clearstream Banking customer; and
A Certificate of Residence for each beneficial owner, issued by the beneficial owner's local tax authorities, it is recommended to provide it double-sided.
Breakdown of refund
- via a duly completed spreadsheet, password-protected, by email to taxspainrefunds@clearstream.com, with the password and the customer instruction to use the spreadsheet for quick or standard refund sent separately via Xact Web Portal, CreationOnline or SWIFT free-format message.
  The CreationOnline or SWIFT free-format message must, in either case, include the following details:
  Attention: PTS Tax Services
  Market: Spain
  Type of refund: Quick or Standard
  Please find hereafter the password to open our breakdown spreadsheet sent to your attention by email on (date and time) from the email address (email address of the sender
  Password:

Supranational organisations

If the beneficial owner is a supranational organisation recognised by Spanish law, the following documentation must be submitted:

A One-Time Certificate for Spanish Equities for the first quick refund application (if not already provided), completed and duly signed by the Clearstream Banking customer; and
Breakdown of refund
- via a duly completed spreadsheet, password-protected, by email to taxspainrefunds@clearstream.com, with the password and the customer instruction to use the spreadsheet for quick or standard refund sent separately via Xact Web Portal, CreationOnline or SWIFT free-format message.
  The CreationOnline or SWIFT free-format message must, in either case, include the following details:
  Attention: PTS Tax Services
  Market: Spain
  Type of refund: Quick or Standard
  Please find hereafter the password to open our breakdown spreadsheet sent to your attention by email on (date and time) from the email address (email address of the sender)
  Password:

and, if applicable:

A copy of the “Convenio Constitutivo” confirming tax-exempt status.

Direct supranational customers of Clearstream Banking that want to obtain tax exemption on dividends from Spanish equities may apply for a standing instruction provided that the customer:

Has the status of a supranational organisation; and
Holds the Spanish securities for itself as sole beneficial owner; and
Submits the required certification to Clearstream Banking by the deadlines set for the respective income payment.

The documentation requirements vary depending on whether the supranational organisation:

Is included in the “consultation” list confirmed by the Spanish Tax Authorities; or
Has signed a “Convenio Constitutivo” with Spain.

Tax-exemption as per “consultation” list

For the standing instruction, the customer is required to submit, once and for the first quick refund application, the following documentation:

Spanish Securities - Standing Instruction for International or Supranational Organisations and Central Banks certifying, among other things, that the customer holds the Spanish securities exclusively as proprietary assets.

Note: The “consultation” list is not exhaustive. It includes a certain number of entities for which the Spanish Tax Authorities have confirmed tax-exempt status, not all supranational organisations recognised by Spanish law.

Tax-exemption based on a “Convenio Constitutivo”

For the standing instruction, the customer is required to submit, once and for the first quick refund application, the following documentation:

Spanish Securities - Standing Instruction for International or Supranational Organisations and Central Banks certifying, among other things, that the customer holds the Spanish securities exclusively as proprietary assets; and
A copy of the “Convenio Constitutivo” confirming tax-exempt status.

Deadline for receipt of documents

Documentation for a quick refund of withholding tax on dividends from Spanish equities must be received by Clearstream Banking at the latest on the third calendar day of the month following the month in which the dividend payment was made, by 10:00 CET.

Important: the deadline is subject to change if the third calendar day falls on a weekend or a bank holiday. Customers are strongly recommended to refer to the prevailing deadlines specified in the SWIFT tax notification in order to avoid any rejection from Clearstream Banking.

Form descriptions are presented according to the procedures available for relief and/or reclaim of withholding tax on income from Spanish equities.