investor profile · nb: if the mutual fund is itself a corporation or is treated as a corporation...

1 | I N V E S T O R P R O F I L E

Investor Profile

Italian Mutual Fund

2017

Strictly Private and Confidential


Disclaimer

The information provided in this publication is for general information purposes only and is valid as at January 1, 2017. Any changes to legislation or treaties will be

published via the RBC Investor & Treasury Services Tax Newsflash procedure and subsequent editions of this publication will be updated accordingly. The information

in this publication should not be regarded as advice. RBC Investor & Treasury Services™ are not responsible for the accuracy of the information, or for any actions

taken based on the information. We strongly recommend consultation with appropriate tax advisors.

RBC Investor & Treasury Services™ is a global brand name and is part of Royal Bank of Canada. RBC Investor & Treasury Services is a specialist provider of asset

servicing, custody, payments and treasury services for financial and other institutional investors worldwide. RBC Investor Services™ operates through two primary

operating companies, RBC Investor Services Trust and RBC Investor Services Bank S.A., and their branches and affiliates.

In the UK, RBC Investor Services Trust operates through a branch authorized by the Prudential Regulation Authority and regulated by the Financial Conduct Authority

and the Prudential Regulation Authority. The Dubai Branch of RBC Investor Services Trust is regulated by the Dubai Financial Services Authority.

In Australia, RBC Investor Services Trust is authorized to carry on financial services business by the Australian Securities and Investments Commission under the

AFSL (Australian Financial Services Licence) number 295018.

In Singapore, RBC Investor Services Trust Singapore Limited (RISTS) is licensed by the Monetary Authority of Singapore (MAS) as a Licensed Trust Company under

the Trust Companies Act and was approved by the MAS to act as a trustee of collective investment schemes authorized under S 286 of the Securities and Futures Act

(SFA). RISTS is also a Capital Markets Services Licence Holder issued by the MAS under the SFA in connection with its activities of acting as a custodian.

In Hong Kong, RBC Investor Services Bank S.A. is a restricted license bank and is authorized to carry on certain banking business in Hong Kong by the Hong Kong

Monetary Authority. RBC Investor Services Trust Hong Kong Limited is regulated by the Mandatory Provident Fund Schemes Authority as an approved trustee.

® / ™ Trademarks of Royal Bank of Canada. Used under licence.


Contents

Overview of RBC Investor & Treasury Services’ withholding tax policies 3

Markets 7

Additional comments: 16


Overview of RBC Investor & Treasury Services’ withholding tax policies

1. ACCOUNT OPENING / NEW PORTFOLIO INVESTMENT

Information / documentation required from the client

When a client opens a Global Custody account for the first time, the appropriate Tax Questionnaire and relevant documents including self- certification forms for

regulatory reporting purposes , as provided in the account opening package must be completed providing full details of the beneficial owner of any income received

for the account. Where a Tax Questionnaire is not completed the Bank will not supply any tax services for that account and full withholding tax rates will be applied.

When a client initially opens a global custody account a detailed list of investment markets is requested. This list provides the necessary information for the Bank to

complete tax documentation or request additional client documentation to ensure the appropriate tax rate is obtained in each market.

If, at a later date, the client’s investment strategy requires the opening of a global custody account in a new market, current procedures provides for a weekly report to

be produced detailing the new market. At this stage the bank will, as part of its client monitoring service, complete or request any necessary tax documentation.

If no such advice or requested documentation is received the Bank will not accept any liability for any tax losses incurred. Furthermore, it is the responsibility of the

client to advise the Bank of any changes that may lead to a reclassification of client type for the beneficial owner of the account or other details relating to their tax

status, such as a change in Local Tax Office or Tax Identification Number. Any changes must be advised to the Bank within 10 business days. (Please refer to the

Taxation SLS for full details of clients’ responsibilities and the service that can be expected from RBC Investor & Treasury Services).

General Requirements

Power of Attorney

As a part of the account opening package (Tax Questionnaire) the Bank requires the completion of a Power of Attorney from the beneficial owner (or where

appropriate the Trustees of a fund). This POA enables the Bank to complete many of the required documents in-house without further recourse to the client. Market

specific requirements are detailed below and markets where the Bank can complete documentation on behalf of the beneficial owner where a POA is held are clearly

marked. Note that due to market conditions clients requiring relief at source or reclaim services on Italian securities (including Italian Government Bonds held in a

depositary such as Euroclear) must provide the Bank with a further two Notarized Powers of Attorney. Certain markets or scenarios exist where it is not possible for

the Bank to complete the required documentation on behalf of the beneficial owner, even under POA, and in these cases it will be the client’s responsibility to provide

the necessary documents on request. The most important of these markets is the US where completion of a W-8 series form is a necessity. In addition, in certain

cases a client may not wish to provide RBC Investor & Treasury Services with a Power of Attorney. In such cases it may be arranged for clients to complete any

additional specific documentation required themselves.


Certification of Residency

In order to obtain Double Taxation Treaty benefits in a number of foreign markets, the Italian Tax Office is required to issue certificates of residence or certify tax

reclaim forms. In order to facilitate the issuance of certificates of residence and the certification of tax reclaim forms, for each Italian resident client the Bank will

require the beneficial owner to provide to it a Tax Office Authority document. This document enables the Bank to liaise directly with the company’s tax office in order to

obtain appropriate Italian residence certifications for tax relief claims. Please note that without this document no tax service can be offered to clients.

Country Specific Requirements

US Form W8-BEN/E

This document alleviates the charge to US backup tax on US source income payments and gross sale proceeds received by RBC Investor & Treasury Services

across all countries of investment. For corporates invested in US bonds, it also enables "portfolio interest" to be paid without deduction of US Non Resident

Withholding Tax.

Collective Investment Vehicle Shareholder Percentage Questionnaire

This requirement pertains to collective investment vehicles investing in Austria, France, Germany and / or Switzerland only. Details as at the end of the previous tax

year are to be provided for new accounts and on an annual basis thereafter. Please refer to the guidelines / explanatory notes provided below for further information:

Austria

A new rule was implemented at the end of December 2008 whereby each tax reclaim filed in Austria by a Non-Austrian resident Investment Vehicle must include an

Attestation of Holding providing shareholder percentage information. Additional disclosure of investors holding 10 % or more in the Investment Vehicle is required in

the form of an original Certificate of Residence. This rule is effective retroactively to January 1, 2008.

France

The purpose of providing shareholder percentage information is to prove that 100% of the participants in the fund are resident in the same country as the fund itself. If

this is not the case then the fund cannot benefit from the simplified procedure. The percentage of participants resident in the same country as the fund must be taken

at the close of the accounting year preceding the dividend payment date.

Please note that Australian investment funds were not mentioned in Statement of Practice 4 J-1-05 which extended the simplified procedure in 2005. Therefore the

treaty eligibility of these funds is unclear and may be assessed by the French tax authorities on a case by case basis.

Germany

A requirement in the form of a ‘statement of beneficial ownership’ was introduced in 2000, which provides the German Tax Authority with the percentage of

shareholders or unit holders that are resident in the country where the fund is resident. If, for example, a fund provides a statement of beneficial ownership or an


attestation stating that 98% of its shareholders are residents of the country where the fund is resident, only 98% of the tax reclaim will be paid. If the percentage of

ownership is 98.01%, the percentage refund would be rounded up to the next highest whole number (i.e., 99%). NB: If the mutual fund is itself a corporation or is

treated as a corporation for tax purposes, the mutual fund may claim treaty benefits without providing this additional information. However, treaty benefits are, in

principle, only available to the unit holders when the mutual fund is organized as a trust. For non-resident funds organized as trusts that pay tax in their countries of

residence, the percentage of beneficial ownership declaration should not be required because these entities are generally considered by their country of residence to

be the beneficial owners of the income.

Switzerland

The percentage shareholding for the underlying holders comprising a mutual or investment fund is required on an annual basis and should be taken at the end of the

fund’s accounting year. Claims for refund are generally based on the proportion of shares beneficially owned by shareholders resident in the country of domicile of the

fund.

Note that the requirement for shareholder percentage information applies to Australian resident “trust estates” (i.e. trust estates as defined in division 6 of Part III of

the Income Tax Assessment Act 1936, as amended) investing in Switzerland. Australian resident “public trading trusts” and “corporate unit trusts” are entirely entitled

to a treaty based refund in Switzerland and are therefore not required to supply any unit holder distribution information.

Client Service Managers will provide clients with the required documentation at the time of account opening or investment in a new market, and periodically when

renewals are required.

2. CROSS BORDER CUSTODY AND SETTLEMENT – TAX RECLAIMS

Restrictions are placed on providing a withholding tax reclaim or relief at source service on cross border holdings. A cross border security is any security settled and

held by an agent in a country not being the home country of location of that security. Due to inherent risks such as an inability to process cross border reclaims by the

sub agent holding the security and substantial agent fees where cross border reclaims are available.

This policy is extended to equity investments held through Euroclear but excludes ADR’s.

3. GLOBAL MINIMUM TAX RECLAIM THRESHOLD

A minimum reclaim value is set for all withholding tax reclaim territories. All reclaims with a value falling under the minimum threshold for that market will not be

processed by RBC Investor & Treasury Services. Such claims will be deleted from any accruals reported to clients. This is due to the fact that it is uneconomic, based

on agent charges and internal processing costs for RBC Investor & Treasury Services to process reclaims under a certain value.


4. ITALIAN BONDS HELD IN EUROCLEAR

An exemption from withholding tax exists for Italian bonds for eligible investors. Operationally the process for exempting bonds for clients who bulk trade across

accounts is not available if the bonds are held in the Euroclear depositary. These clients must hold their Italian Bonds in the Domestic Market if they wish to achieve

exemption. However, any beneficial owner that operates a segregated account on Milvus and trades separately for that account will be offered a relief at source

service in Euroclear, if required, from the date of receipt of the appropriate tax documentation required to exempt the account from Italian withholding tax.


Markets

Country Dividends

standard

Dividends

treaty

Corporate

bonds

standard

Government

bonds standard

Interest

treaty

Notes

Argentina 0 15 0/15.05/35 0 20 Dividends: If the dividend distribution exceeds the after tax accumulated

taxable income of the payer a withholding of 35% may be imposed on the

income

Interest: Interest derived by non-residents from Argentinean government and

corporate bonds is exempt from withholding tax. A 15.05% rate applies to

interest (other than bond interest) derived by non-resident financial institutions

which conform to the Basle standards for banks. Otherwise, the domestic rate

of withholding tax on interest derived by non-resident companies

is 35%.

Australia 1

(Relief at Source

Territory)

30/0*

30% rate for unfranked dividends, 0% rate for fully franked dividends

15 0 0 10 Documentation required from client

None required

Forms that RBC Investor & Treasury

Services may complete on behalf of

client and process/ action to be:

None required

Austria

(Reclaim

Territory)

27.5 15 (12.5) 0 0 10/0 Documentation required from client

1. Power of attorney

2. T1013 (Tax Office Consent)

3. Full beneficiary details provided in completed Tax Questionnaire

Forms that RBC Investor & Treasury Services may complete on behalf of client and process/ action to be:

Tax reclaim application including shareholder percentage information

Sent to client’s tax office for certification of residency.

Submitted to agent bank in Austria

Bangladesh 30 15 20 20 10


Belgium

(Reclaim

Territory)

30/15*

*15% rate applies to certain shares issued on or after 1 January, 1994 and shares of investment companies (SICAV's, SICAF's and OPCC's)

15 (15) 30 0 15/0 Documentation required from client

Reclaim:


2. Tax Office Authority





Reclaim:

Tax reclaim application sent to client’s tax office for certification of residency

A Form C is prepared and submitted to the agent

Brazil

0 15 15 0 15 Interest: Interest arising in a Contracting State and paid to the Government of

the other Contracting State, a political subdivision thereof or any agency

(including a financial institution) wholly owned by that Government or political

subdivision shall be exempt from tax.

Canada 1

(Relief at Source

Territory)

25 15 0*

*There is no withholding tax deducted on interest income earned by non-residents effective 01.01.08

0 15/0*

*Where the standard rate is lower than the treaty rate, the standard rate applies

Documentation required from client

NR301 is required for non-Canadian

residents except Client Pools. For

Non-Canadian Client Pools a Form A

is required – and these documents

are required to enable them to

receive the treaty rates.


None required

Chile

35 10 35/4 35/4 15 Dividends: The statutory withholding tax rate on dividends is 35%, less a tax credit which varies according to the rate of corporate tax paid by the issuing company.

China 0/10 10 10 10 10 Dividends: Chinese ‘H’ and ‘B’ shares are subject to WHT at 10%

Colombia

(Non-Treaty

Territory)

0/25 n/a 14 14 n/a Dividends: 0% withholding tax rate applies to dividends paid out of taxed

profits. If profits are untaxed, dividends are subject to a rate of 25%.

Effective 1 January 2018, an additional 5% withholding tax will apply to

dividends from results obtained in 2017 regardless of whether the dividends

are paid out of profits that have been taxed.


Czech Republic

(Reclaim

Territory)

35 15 (20) 35 35 0 Documentation required from




Declaration of Beneficial ownership

Certificate of Residence

Denmark

(Reclaim

Territory)

27 15 (12) 0 0 10/0 Documentation required from




Tax reclaim application

Sent to client’s tax office for certification of residency

Submitted to agent bank in Denmark

Estonia 0 15 0 0 10

Finland 1

(Relief at

Source/ Reclaim

Territory )

30 15 (15) 0 0 15/0 Documentation required from

Relief at Source:

Beneficial owner details (one off requirement per Tax Questionnaire, information update required should details change)

Reclaim:





Relief at Source:

Beneficial owner breakdown to be provided prior to each dividend payment

Reclaim:



Submitted to agent bank in Finland

France 1

(Relief at

Source/Reclaim

Territory)

30 15 (15) 0 0 10/0*

*An exemption is provided for interest paid by the state, local authorities, the central

Documentation required from

Relief at Source:

1. Power of attorney to enable RBC Investor & Treasury Services to complete the required forms (one off requirement per Tax Questionnaire, renewable should


Relief at Source:

Certified form to be lodged with agent in France annually

Reclaim:

1 0 | I N V E S T O R P R O F I L E

bank or entities of similar nature.

details change)

2. Tax Office details and reference number (one off requirement per Tax Questionnaire, information update required should details change)


Reclaim:





incorporating specific attestation


Submitted to agent bank in France

Germany

(Reclaim

Territory)

26.375 15 (11.375) 0 0 10/0 Documentation required from client




4. Shareholder percentage questionnaire

Forms that RBC Investor & Treasury Services may complete on behalf of client and process/action to be:

Tax reclaim application including shareholder percentage information

sent to client’s tax office for certification of residency

Submitted to agent bank in Germany

Greece

15 35 0 0 10

Hong Kong 0 10 0 0 12.5

Hungary 0 10 30/0 0 0

India 0 25 20 20 15 Interest: 20% rate applies to interest from foreign currency loans, corporate

and government bonds.

Indonesia 20 15 20 20 10 In order to get treaty relief specific forms have to be completed within very tight deadlines The treaty relief Forms require endorsement by the tax authorities in the relevant entity’s own jurisdiction. These include a number of items on which tax authorities may not have sufficient information to appropriately endorse, such as the following:


• The entity / transaction structure is not motivated by tax avoidance • The entity is independently managed • The entity employs sufficient qualified personnel • The entity has active business activities • The company is subject to tax in its jurisdiction on Indonesian sourced income; and The requirements for DTT relief are complicated and subject to interpretation. As a general rule the beneficial owner must: • be resident of a treaty country • provide the required documentation • not be an agent, nominee, trustee or conduit

Ireland

(Domestic

Exemption at

Source/ Reclaim

Territory)

20

0

Under the DWT scheme residents of treaty countries are entitled to full exemption on Dividend withholding tax

20 0 10/0 Documentation required from client

1. Power of attorney to enable RBC Investor & Treasury Services to complete the required forms (one off requirement per Tax Questionnaire, renewable should details change)


3. Tax Office Authority to enable

RBC Investor & Treasury

Services to request certifications

of residency


Clients are initially assigned to a general account to which the maximum withholding tax rate is assigned

Once the Certificate of residency has been received, and if there is a Power of Attorney in place, RBC Investor & Treasury Services will complete a DWT form on behalf of the client and re-assign the account to the exempt location

If tax has been deducted during the time that the client was assigned to the taxable account then a retroactive reclaim is possible to obtain the difference between the maximum tax deducted and the treaty rate


Israel 1

(Reclaim/Relief

at Source

Territory)

25 15 (10)

The entity must be subject to tax in Italy in order to benefit from the treaty rate

0 0/25

Non-resident investors are subject to a 24% withholding tax rate on interest from short term government bonds and, interest from redemption of Makams

10 Documentation required from client

Relief at Source & Reclaims:


2. RC59 (Tax Office Consent)



Relief at Source & Reclaims:

A114 form

Certificate of Residence

Japan 15.315

15 15.315 15.315/0*

*0% rate applies to government bonds if held on the Bank of Japan's book entry system and the intermediary acts as a qualifying intermediary


None required


None required

Lithuania

15 15 10 10 10 Interest: Effective 01.01.10 interest paid to legal entities resident in EEA and DTA countries is exempt

Luxembourg 15 15 0 0 10

Malaysia 25 - 15 15 15 Dividends: There is no dividend withholding tax. However, there is a 25% tax

charge on the gross dividends which is a deduction of Malaysian tax credits.

Mexico 10 15 30/10/4.9 0 15 Interest: 10% paid on negotiable instruments, 4.9% on interest paid to banks,

30% rate applies to residents of the black list countries

Morocco 15 15 10 10 10

Netherlands

15 15 0 0 10 Documentation required

from client

None required



client and process/action to be:

None required

New Zealand1 1

(Relief at Source

Territory)

30 15 15/2*

*2% rate applies where Approved Issuer Levy has been

15/2/0 10/2/0 Documentation required from client

None required


None required


applied for

Norway 1

(Relief at

Source/Reclaim

Territory)

25 15/0 (25)*

*The Tax Exemption Model provides a WHT exemption for “corporate shareholders” resident in the EU/EEA effective retroactively from 01.01.04

0 0 0 Documentation required from client

*For The Exemption Model only:



3. Beneficial owner questionnaire


*For The Exemption Model only:

First-time reclaims application with accompanying Norwegian Attestation and Certificate of Residency. Thereafter it should be possible to assign the investor to a segregated account and apply exemption at source on provision of an annual attestation.

Pakistan 7.5/12.5 25 10 10 30 Dividends: 7.5% = dividends paid by companies engaged in power generation or by purchasers of privatized power companies and by companies engaged exclusively in mining operations other than petroleum.

Peru (Non-

Treaty

Territory)

5 n/a 30 30 n/a

Philippines 30 15 30 30 15 Dividends: The rate is reduced to 15% if the country of domicile of the

recipient allows a tax credit for taxes deemed payable in the Philippines

equivalent to 17%. Due to the restrictive and unworkable time frames

introduced in the market, reduction at source is currently unavailable.

Poland 1

(Relief at Source

Territory)

19 10 20 20 10 Documentation required from client





Certificate of residency

Portugal 2

(Reclaim

Territory)

25/35 15 (10) 25/35

0



2. RC59 (Tax Office Consent)






Sent to client’s tax office for

certification of residency

Submitted to agent bank in

Portugal


Income breakdowns

Russia 15 10 15/20 0 10 Interest: 15% rate applies to certain types of state and municipal securities

Singapore 0 10 15 15 12.5

Slovakia 0 15 0 0 0

South Africa 20 15 0 0 10

South Korea

22 15 15.4 15.4 10 Clients should contact their Tax advisors to complete the relevant

documentation and submit to RBC Investor & Treasury Services

Spain

(Reclaim

Territory)

19 15 (4) 19/0*

*A domestic exemption is available on interest from qualifying corporate bonds

19/0*

*0% rate applies to certain Government Treasury stock. Interest on public debt paid to non- residents without a permanent establishment in Spain is exempt on provision of a certificate of residence

12

Interest paid to an EU resident without a permanent establishment in Spain is exempt on provision of a certificate of residence

Documentation required from client




Quick Refund Procedure:

Certification of Tax residency

requested from client’s tax office

annually

Income breakdowns

Standard Reclaim Procedure:

Certified Tax Reclaim form

Income breakdowns

Sri Lanka 10 15 10 0 10

Sweden 1

(Relief at

Source/ Reclaim

Territory)

30 15 (15) 0 0 0 Documentation required

from client

Relief at Source & Reclaim:





Relief at Source:

Beneficial owner breakdown to be provided prior to each dividend payment

Reclaim:





Submitted to agent bank in

Sweden

Switzerland

(Reclaim

Territory)

35*

*Effective 1st January 2011, Swiss companies may pay all or part of their dividends tax free under the capital distribution principle.

15 (20) 35 35 12.5/0 Documentation required from client

1. Power of Attorney



4. Shareholder percentage questionnaire


Tax reclaim application incorporating shareholder percentage information



Submitted to Swiss Tax

Authorities annually

Taiwan

20 10 15 15 10 Dividends: 30% = payment to non-resident individuals, 25% = payments to

non-resident corporations, 20% = payments on investments approved by the

ROC government pursuant to the Statute for Investment by Foreign Nationals

or the Statute for Investment by Overseas Chinese

Interest: 15% = short term bills, Government/Corporate bonds/ Financial Debentures, Securitization Products e.g. ABS, REITs and RAETs, and repos on all of these. 20% applies to other forms of interest.

Thailand 10 10 15 15/0 10

Turkey 15 15 0 0 15 .

Interest: 0% rate applies to Government securities. However the Earthquake

Tax Scheme effective 1 January 2000 applies a surcharge of between 4% and

19% depending on maturity. 0% rate under treaty applies to interest derived by

Government.

UK 1

(Relief at Source

Territory)

0

10 20/0*

*0% rate applies to interest from publicly quoted securities

0 10/0 Documentation required

from client

None required




None required

US

(Relief at Source

Territory)

30 30 30/0*

*0% rate applies to

30/0*

*0% rate applies to portfolio debt

10/0 Documentation required

from client

W8-BENE Form (renewable should





portfolio debt securities and government interest

securities and government interest

details change, per Tax Questionnaire)

It is not possible for RBC Investor & Treasury Services to complete this document on behalf of the beneficial owner

Once the appropriate W8-BENE form has been received and validated, the client will receive all income going forward with the correct rate of withholding tax applied

Venezuela 34 10 34 34 10 Interest: Withholding tax is imposed on 90% of the gross payment for

individuals (the effective rate is 30.6%). Interest paid to financial institutions is

set at a flat rate of 4.95%.

1 Generally speaking, where possible, RBC Investor & Treasury Services will take the necessary action in order to obtain upfront relief at source on income. These territories have a mixture of reclaim and

relief at source opportunities. In addition where a timing issue necessitates full withholding on income, retroactive reclaims will be processed in the above territories.

2 Relief at source in respect of Portuguese income is possible in theory but is currently not achievable in practice. This is due to a market issue that RBC Investor & Treasury Services will continue to

monitor.


Additional comments:

Relief at Source Territories (Or unspecified territories) - Please

Reclaim Territories - Statutes and refund timeframes: Statutes & Refund Timeframes

Tax rates for other markets in which investment is possible through RBC Investor & Treasury Services are available on request.

http://gmi.rbcits.com/rt/gss.nsf/File+Attachments/AU+Residents/$FILE/Statutes%20and%20Refund%20Timeframes%20-%20AU%20Residents.pdf

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