EU smernice o rychlejsi a bezpecnejsi uleve od nadmernych srazkovych dani

EU Directive on Faster and Safer Relief of Excess Withholding Taxes 

The EU reached political agreement on the Directive setting forth rules aimed at making certain specific withholding tax procedures in the EU more efficient and secure (FASTER).

The initiative includes the following main building blocks (detail HERE):  

• A common accelerated EU digital tax residence certificate to be issued by the investor's residence state.
• A choice for Member States between "relief at source" procedure and a "quick refund" system or a combination of both - for dividends from publicly traded shares and optionally for interest payments on publicly traded bonds (with various exceptions).
• The establishment of a register of certified financial intermediaries and an introduction of a common reporting (and verification) obligations on certified financial intermediaries in the chain.

The rules should generally come into effect as of 1 January 2030.

The Czech Ministry of Finance has issued a statement (HERE), in which it states, among other things, that "the administrative system designed by the directive is built primarily for countries with a refund system, and therefore it would mean for the Czech Republic mainly an increase in administrative burden without adequate benefit.... The latest amendments to the directive... in the form of extending the exemption from its application lead to the fact that it is not realistic for the Czech Republic to meet the parameters that will require the obligation to apply the directive in the Czech Republic."

If you have any questions, please contact the author of this article or the EY tax team with whom you regularly work.

Author:

Karel Hronek