Aberdeen e-alert - Issue 2015-09

Aberdeen e-alert - Issue 2015-09

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Update on Spain

New withholding tax rate applicable

Further to a legislative amendment, the standard withholding tax (WHT) rate on all Spanish securities (debt securities and equities) has been reduced from the current 20% to 19.5% on 13 July 2015.

 

List of companies eligible to Spanish Luxembourg DTT

On 21 July 2015, the Luxembourg Tax Authorities released Circular L.G. – Conv. D.I. n° 52 in order to clarify the non-entitlement of certain Luxembourg companies to benefit from the provisions of the double tax treaty (DTT) signed between Luxembourg and Spain

 

Background

Further to the exchanges of letters dated 15 April and 13 May 2015 between the Spanish and Luxembourg Tax Authorities, both parties agreed on an extension/clarification of the list of Luxembourg companies not eligible to the Luxembourg-Spain DTT to the following entities:

  • Sociétés de Gestion de Patrimoine Familial (SPF),
  • Sociétés d’Investissement à Capital Fixe (SICAF), and
  • Sociétés d’Investissement à Capital Variable" (SICAV) regulated under Section II of the "loi du 17 décembre 2010 concernant les organismes de placement collectif" (Luxembourg official Gazette 24 December 2010) and by the "loi du 13 février 2007 relative aux fonds d’investissement spécialisés" (Luxembourg official Gazette 13 February 2007), i.e., non-UCITS SICAVs.

 

KPMG comments

This circular should not change the status of Luxembourg non-UCITS SICAVs, it merely confirms an existing situation, i.e. tax reclaims based on DTT for these entities should not be possible.

Please refer to the below summary table highlighting for each investment legal form on which legal basis withholding tax suffered on Spanish source dividend distributions can be reclaimed.

 

 

Investment

Funds

 

Legal basis

Rate

 

DTT

EU Law

Spanish National

Law

DTT

EU Law

Spanish National

Law

UCITs

SICAV

YES

N/A

YES

14%

N/A

4.5%

FCP

N/A

N/A

YES

N/A

N/A

18.5%

Non-UCITs

SICAV

N/A

YES

N/A

N/A

18.5%

N/A

FCP

N/A

YES

N/A

N/A

18.5%

N/A

 

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.

 

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