EC on taxation of savings income in the form of interest payments - Main contents

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dossier	COM(2008)727 - Amendment of Directive 2003/48/EC on taxation of savings income in the form of interest payments.
document	COM(2008)727
date	March 24, 2014

ANNEX

The Annex to Directive 2003/48/EC is amended as follows:

(1)	The Annex becomes ‘Annex III’.

(2)

The following Annex is inserted as ‘Annex I’:

‘ANNEX I

Indicative list of categories of entities and legal arrangements which are considered to be not subject to effective taxation, for the purposes of Article 2(3)

Entities and legal arrangements whose place of establishment or place of effective management is in a country or jurisdiction outside the territorial scope of this Directive as defined in Article 7 and which is different from those listed in Article 17(2):

Countries and jurisdictions	Categories of entities and legal arrangements
Antigua and Barbuda	International business company
Anjouan (Comores)	Trust, governed by local or foreign law International business company
The Bahamas	Trust, governed by local or foreign law Foundation International business company
Bahrain	Financial trust, governed by local or foreign law
Barbados	Trust, governed by local or foreign law International business company International Society with Restricted Liability
Belize	Trust, governed by local or foreign law International business company
Bermuda	Trust, governed by local or foreign law Exempt company
Brunei	Trust, governed by local or foreign law International business company International trust International Limited Partnership
Cook Islands	Trust, governed by local or foreign law International trust International company International partnership
Costa Rica	Trust, governed by local or foreign law Company
Djibouti	Exempt company Trust, governed by foreign law
Dominica	Trust, governed by local or foreign law International business company
Fiji	Trust, governed by local or foreign law
French Polynesia	Société (Company) Société de personnes (Partnership) Société en participation (Joint venture) Trust, governed by foreign law
Grenada	International business company Trust, governed by local or foreign law
Guam	Company Sole proprietorship Partnership Trust, governed by foreign law
Guatemala	Trust, governed by local or foreign law Fundación (Foundation)
Hong Kong	Trust, governed by local or foreign law Private Limited Company
Kiribati	Trust, governed by local or foreign law
Labuan (Malaysia)	Offshore company Malaysian offshore bank, Offshore limited partnership Offshore trust
Lebanon	Companies benefiting from the Offshore company regime Trust, governed by foreign law
Liberia	Non-resident company Trust, governed by local or foreign law
Macao	Trust, governed by local or foreign law Fundação (Foundation)
Maldives	Company Partnership Trust, governed by foreign law
Northern Marianas Islands	Foreign sales corporation Offshore banking corporation Trust, governed by foreign law
Marshall Islands	Trust, governed by local or foreign law International business company
Mauritius	Trust, governed by local or foreign law Global business company categories 1 and 2
Micronesia	Company Partnership Trust, governed by foreign law
Nauru	Trust/nominee company Company Partnership Sole proprietorship Foreign will Foreign estate Other form of business negotiated with the Government
New Caledonia	Société (Company) Société civile (Civil company) Société de personnes (Partnership) Joint venture Estate of deceased person Trust, governed by foreign law
New Zealand	Trust, governed by foreign law
Niue	Trust, governed by local or foreign law International business company
Panama	Fideicomiso (Trust, governed by local law) and trust governed by foreign law Fundación de interés privado (Foundation) International business company
Palau	Company Partnership Sole proprietorship Representative office Credit union (financial cooperative) Cooperative Trust, governed by foreign law
Philippines	Trust, governed by local or foreign law
Puerto Rico	Estate Trust, governed by local or foreign law International banking entity
Saint Kitts and Nevis	Trust, governed by local or foreign law Foundation Exempt company Exempt Limited Partnership
Saint Lucia	Trust, governed by local or foreign law International business company
Saint Vincent and the Grenadine	Trust, governed by local or foreign law International business company
Sao Tomé e Principe	International business company Trust, governed by foreign law
Samoa	Trust, governed by local or foreign law International trust International company Offshore bank Offshore insurance company International partnership Limited partnership
Seychelles	Trust, governed by local or foreign law International business company
Singapore	Trust, governed by local or foreign law
Solomon Islands	Company Partnership Trust, governed by local or foreign law
South Africa	Trust, governed by local or foreign law
Tonga	Trust, governed by local or foreign law
Tuvalu	Trust, governed by local or foreign law Provident fund
United Arab Emirates	Trust, governed by local or foreign law Offshore company
State of Delaware (USA)	Limited Liability Company
State of Wyoming (USA)	Limited Liability Company
US Virgin Islands	Trust, governed by local or foreign law Exempt company
Uruguay	Trust, governed by local or foreign law Sociedad Anónima Financiera de Inversión
Vanuatu	Trust, governed by local or foreign law Exempt company International company

Entities and legal arrangements whose place of establishment or place of effective management is in a country or jurisdiction listed in Article 17(2), to which Article 2(3) applies pending the adoption by the country or jurisdiction concerned of provisions equivalent to those of Article 4(2):

Countries and jurisdictions	Categories of entities and legal arrangements
Andorra	Trust, governed by foreign law
Anguilla	Trust, governed by local or foreign law International business company
Aruba	Trust, governed by local or foreign law Stichting Particulier Fonds
British Virgin Islands	Trust, governed by local or foreign law Company
Cayman Islands	Trust, governed by local or foreign law Exempt company
Guernsey	Trust, governed by local or foreign law Company Foundation
Isle of Man	Trust, governed by local or foreign law Company
Jersey	Trust, governed by local or foreign law Company Foundation
Liechtenstein	Anstalt (Trust, governed by local law) and trust governed by foreign law Stiftung (Foundation)
Monaco	Trust, governed by foreign law Fondation (Foundation)
Montserrat	Trust, governed by local or foreign law International business company
Netherlands Antilles	Trust, governed by local or foreign law Stichting Particulier Fonds
San Marino	Trust, governed by local or foreign law Fondazione (Foundation)
Switzerland	Trust, governed by foreign law Foundation
Turks and Caicos	Exempted company Limited partnership Trust, governed by local or foreign law’.

(3)

The following Annex is inserted as ‘Annex II’:

‘ANNEX II

Indicative list of categories of entities and legal arrangements which are considered to be not subject to effective taxation, for the purposes of Article 4(2)

Countries

Categories of entities and legal arrangements

Comments

All EU Member States

European Economic Interest Grouping (EEIG)

Belgium

—	Société de droit commun/maatschap (Civil law or commercial company without any legal status)

—	Société momentanée/tijdelijke handelsvennootschap (Company without any legal status whose purpose is to deal with one or several specific commercial operations)

—	Société interne/stille handelsvennootschap (Company without any legal status through which one or more persons have an interest in operations that one or more other persons manage on their behalf)

Included only if the upstream economic operator making the interest payment to it, or securing the payment for it, has not established the identity and residence of all its beneficial owners, otherwise it falls within point (d) of Article 4(2).

These “companies” (the name of which is given in French and Dutch) do not have legal status, and from the point of view of taxation, a look-through approach is applicable.

—	“Trust” or other similar legal arrangement, governed by foreign law

Bulgaria

—	Дружество със специална инвестиционна цел (Special-purpose investment company)

—	Инвестиционно дружество (Investment company, not covered by Article 6)

Entity exempt from corporate income tax

—	“Trust” or other similar legal arrangement, governed by foreign law

Unless the trustee can prove that the trust is actually subject to Bulgarian income taxation

Czech Republic

—	Veřejná obchodní společnost (veř. obch. spol. or v.o.s.) (Partnership)

—	Sdružení (Association)

—	Komanditní společnost

—	“Trust” or other similar legal arrangement, governed by foreign law

Denmark

—	Interessentskab (General partnership)

—	Kommanditselskab (Limited partnership)

—	Kommanditaktieselskab/Partnerselskab

—	Partrederi

—	“Trust” or other similar legal arrangement, governed by foreign law

Germany

—	Gesellschaft bürgerlichen Rechts (Civil law company)

—	Kommanditgesellschaft — KG, offene Handelsgesellschaft — OHG (Commercial partnership)

—	“Trust” or other similar legal arrangement, governed by foreign law

Estonia

—	Seltsing (Partnership)

—	“Trust” or other similar legal arrangement, governed by foreign law

Ireland

—	Partnership and investment club

Irish resident trustee is generally taxable on income arising to the trust. However, where the beneficiary or trustee is a non-Irish resident, only Irish source income arising in such cases is taxable.

Greece

—	Ομόρρυθμος εταιρεία (OE) (General partnership)

—	Ετερόρρυθμος εταιρεία (EE) (Limited partnership)

Partnerships are subject to corporate income tax. However, up to 50 % of the profits of partnerships is taxed in the hands of the individual partners at their personal tax rate.

—	“Trust” or other similar legal arrangement, governed by foreign law

Spain

—

Entities subject to the system for taxing attribution of profits:

—	Sociedad civil con o sin personalidad jurídica (Civil law partnership with or without legal personality),

—	Herencias yacentes (Estate of a deceased person),

—	Comunidad de bienes (Joint ownership).

—	Other entities without legal personality that constitute a separate economic unit or a separate group of assets (Article 35(4) of the Ley General Tributaria).

—	“Trust” or other similar legal arrangement, governed by foreign law

France

—	Société en participation (Joint venture company)

—	Société ou association de fait (De facto company)

—	Indivision (Joint ownership)

—

Fiducie

—	“Trust” or other similar legal arrangement, governed by foreign law

Italy

—	All Civil law partnerships and assimilated entities

The category of Civil law partnerships includes: “società in accomandita semplice”, “società semplici”, associazioni (associations) among artists or professional persons for the practice of their art or profession, without legal personality “società in nome collettivo”, “società di fatto” (irregular or “de facto” partnerships) and “società di armamento”

—	Companies with a limited number of shareholders opting for fiscal transparency

The “tax transparency” regime may be adopted by limited liability companies or cooperative societies whose members are individuals (Article 116 of TUIR).

—	“Trust” or other similar legal arrangement, governed by foreign law

Unless the trustee can provide documentation proving that the trust is fiscally resident and subject to effective corporate taxation in Italy.

Cyprus

—	Συνεταιρισμός (Partnership)

—	Σύνδεσμος or σωματείο (Association)

—	Συνεργατικές (Cooperative)

Only transactions with members.

—	“Trust” or other similar legal arrangement, governed by local or foreign law

Trusts created under Cypriot jurisdiction are considered transparent entities under national law.

Latvia

—	Pilnsabiedrība (General partnership)

—	Komandītsabiedrība (Limited partnership)

—	Biedrība un nodibinājums (Association and foundation)

—	Lauksaimniecības kooperatīvs (Agriculture cooperative)

—	“Trust” or other similar legal arrangement, governed by foreign law

Lithuania

—	“Trust” or other similar legal arrangement, governed by foreign law

Luxembourg

—	“Trust” or other similar legal arrangement, governed by foreign law

Hungary

—	“Trust” or other similar legal arrangement, governed by foreign law

Hungary recognises trusts as “entities” under national rules

Malta

—	Soċjetà In Akkomandita (Partnership “en commandite”), the capital of which is not divided into shares

—	Arrangement in participation (Association “en participation”)

—	Soċjetà Kooperattiva (Cooperative society)

Partnerships “en commandite” the capital of which is divided into shares are subject to general CIT.

The Netherlands

—	Vennootschap onder firma (General partnership)

—	Commanditaire vennootschap (Closed limited partnership)

General partnerships, closed partnerships and EEIGs are transparent for tax purposes.

—	Vereniging (Association)

—	Stichting (Foundation)

Verenigingen (Associations) and stichtingen (foundations) are tax exempt unless they carry on a trade or business.

—	“Trust” or other similar legal arrangement, governed by foreign law

Austria

—	Offene Gesellschaft (OG) (general partnership)

—	Offene Handelsgesellschaft (OHG) (commercial partnership)

—	Kommanditgesellschaft (KG) (limited partnership)

—	Gesellschaft nach bürgerlichem Recht (civil law partnership)

—	“Trust” or other similar legal arrangement, governed by foreign law

Poland

—	Spólka jawna (Sp. j.) (General partnership)

—	Spólka komandytowa (Sp. k.) (Limited partnership)

—	Spólka komandytowo-akcyjna (S.K.A.) (Limited joint-stock partnership)

—	Spólka partnerska (Sp. p.) (Professional partnership)

—	Spolka cywilna (s.c.) (civil law company)

—	“Trust” or other similar legal arrangement, governed by foreign law

Portugal

—	Civil law partnerships not incorporated in a commercial form

—	Incorporated firms engaged in listed professional activities in which all partners are individuals qualified in the same profession

—	Companies merely holding assets which are either controlled by a family group or fully owned by no more than five persons;

—	Companies licensed to operate on the International Business Centre of Madeira eligible for exemption from IRC (Article 33 of the EBF)

Article 33 of EBF, applicable to companies licensed until 31 December 2000, provides for an exemption from corporate income tax until 31 December 2011.

—	Unincorporated associations

—	“Trust” or other similar legal arrangement, governed by foreign law

The only trusts admitted under Portuguese law are those set up under foreign law by legal persons in the International Business Centre of Madeira.

Romania

—	Association (partnership)

—	Cooperative (Cooperative)

—	“Trust” or other similar legal arrangement, governed by foreign law

Slovenia

—	“Trust” or other similar legal arrangement, governed by foreign law

Slovak Republic

—	Verejná obchodná spoločnosť (General partnership)

—	Komanditná spoločnosť (Limited partnership)

—	Združenie (Association)

—	“Trust” or other similar legal arrangement, governed by foreign law

Finland

—	avoin yhtiö/öppet bolag (Partnership)

—	kommandiittiyhtiö/kommanditbolag (Limited partnership)

—	“Trust” or other similar legal arrangement, governed by foreign law

Sweden

—	handelsbolag (General partnership)

—	kommanditbolag (Limited partnership)

—	enkelt bolag (Simple partnership)

—	“Trust” or other similar legal arrangement, governed by foreign law

United Kingdom

—	General partnership

—	Limited partnership

—	Limited liability partnership

General partnerships, limited partnerships; limited liability partnerships are transparent for tax purposes.

—	Investment club (where members are entitled to a specific share of assets)

Gibraltar (1)

—	“Trust” or other similar legal arrangement, governed by local or foreign law

Trust income is exempt from tax under the Income Tax Rules 1992 if:

(a)	the trust is created by or on behalf of a non-resident person; and

(b)

the income,

—	is accrued or derived outside Gibraltar, or

—	is received by a trust and if it had been received directly by the beneficiary, it would not be liable to tax under the Income Tax Ordinance.

This does not apply if the trust is created before 1 July 1983 and the terms of the trust expressly exclude residents of Gibraltar as beneficiaries.

(4)

The following Annex is added as ‘Annex IV’:

‘ANNEX IV

LIST OF ITEMS FOR STATISTICAL PURPOSES TO BE PROVIDED ANNUALLY BY MEMBER STATES TO THE COMMISSION

1. Economic items

1.1.   Withholding tax:

For Austria and Luxembourg (as long as they apply the transitional provisions set out in Chapter III), the total annual amount of tax revenue shared from the withholding tax, split by Member State of residence of the beneficial owners.

For Austria and Luxembourg (as long as they apply the transitional provisions set out in Chapter III), the total annual amount of tax revenue shared with the other Member States from the withholding tax levied under Article 11(5).

Data on the total amounts collected from the withholding tax, split by Member State of residence of the beneficial owners, should also be sent to the national institution in charge of compiling balance of payments statistics.

1.2.   Amount of interest payments/sales proceeds:

For the Member States exchanging information or having opted for the voluntary disclosure provision under Article 13, the amount of interest payments within their territory which is subject to exchange of information under Article 9, split by Member State or Dependant and Associated Territory of residence of the beneficial owners.

For the Member States exchanging information or having opted for the voluntary disclosure provision under Article 13, the amount of sales proceeds within their territory which is subject to exchange of information under Article 9, split by Member State or Dependant and Associated Territory of residence of the beneficial owners.

For Member States exchanging information or having opted for the voluntary disclosure mechanism, the amount of interest payments subject to exchange of information, split by type of interest payments according to the categories set out in Article 8(2).

The data related to the total amounts of interest payments and sales proceeds, split by Member State of residence of the beneficial owners, should be communicated also to the national institution in charge of the compilation of Balance of Payments statistics.

1.3.   Beneficial owner:

For all Member States, the number of beneficial owners resident in other Member States and Dependent and Associated Territories, split by Member State or Dependant and Associated Territory of residence.

1.4.   Paying agents:

For all Member States, the number of paying agents (per sending Member State) involved in exchange of information or withholding tax for the purposes of this Directive.

1.5.   Paying agents upon receipt:

For all Member States, the number of paying agents upon receipt having received interest payments within the meaning of Article 6(4). This concerns both sending Member States, in which interest payments have been made to paying agents upon receipt whose effective place of management is in other Member States, and receiving Member States, who have such entities or legal arrangements on their territory.

2. Technical items

2.1.   Records:

For the Member States exchanging information or having opted for the voluntary disclosure provision of Article 13, the number of records sent and received. One record means one payment for one beneficial owner.

2.2.   Processed/corrected records:

Number and percentage of syntactically invalid records that can be processed;

Number and percentage of syntactically invalid records that cannot be processed;

Number and percentage of non-processed records;

Number and percentage of records corrected upon request;

Number and percentage of records corrected spontaneously;

Number and percentage of records processed successfully.

3. Optional items:

3.1.

For the Member States, the amount of interest payments to entities or legal arrangements which is made subject to exchange of information under Article 4(2), split by Member State of the entity's place of effective management.

3.2.

For the Member States, the amount of sales proceeds to entities or legal arrangements which is made subject to exchange of information under Article 4(2), split by Member State of establishment of the entity.

3.3.

The respective shares of total annual tax collected from resident taxpayers on interest payments made to them by domestic paying agents and by foreign paying agents.’.

(1) The United Kingdom is the Member State responsible for the external relations of Gibraltar, under the terms of Article 355(3) of the Treaty on the Functioning of the European Union.’.