We advise Investment funds having paid French withholding tax (“WHT”) in the past to act as soon as possible before year-end.
On 10 May 2012, the Court of Justice of the European Union (“CJEU”) rendered its decision in the Santander Case.
Based on this case, French Tax Law was considered contradictory to the free movement of capital, as there was a discriminatory tax treatment applied to non-resident investment funds.
Consequently, taxpayers having unduly paid WHT can ask for its reimbursement for years covered by the time-limitation period.
In principle, the time-limitation period in France is 2 years, starting on 1 January following the dividend distribution.
However, based on previously applicable French legal provisions, a legal decision revealing the non-conformity of French legislation to an international rule could lead to a WHT reclaim covering a period extended to 3 years before the date of delivery of the decisions and 2 years after the date of delivery of the decision (i.e. from 1 January 2009 to 31 December 2014).
Therefore, in our case, the CJEU’s decision in the Santander case allows Claimants who file claims before 31 December 2014 to request a refund of a French WHT suffered since 1 January 2009.
Nevertheless, starting on 1 January 2015, the normal time-limitation period of two years will again be applicable (i.e. covering 2013 and 2014).
For any investment funds that have not filed refund claims at this date, it is high time to do so now (before the 31 December 2014) in order not to lose definitely French WHT levied during years 2009, 2010, 2011 and 2012.
For further information, please do not hesitate to contact us.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.