Austria: New criteria to determine beneficial ownership

Summary

The Austrian Federal Ministry of Finance (BMF) decided on 15 November 2022 (Geschäftszahl: 2022-0.816.735) to use the day before the Annual General Meeting of companies¹ , during which the dividend was resolved (AGM date -1 day), as the new criteria for determining beneficial ownership.

Up until 14 November 2022, the criteria used was the ex-date² -1 day.

Illustrative example:

• AGM date on 02/06/2022
• Ex-date: 15/06/2022
• Custody account statement to provide at the AGM -1 day (01/06/2022) and on the ex-date -1 day (14/06/2022)
• Record date: 17/06/2022
• Dividend payment date: 15/07/2022
• Transaction list to provide one month before AGM - 1 day (01/06/2022) to one month after the ex-date (15/06/2022)

Currently, the Austrian Law has not been updated the necessary supporting documentation. However, based on the information gathered, the tax authorities will require either new (a) or amended documents as listed below (b, c), for the withholding tax applications that should be impacted.

a. The dividend statement including a confirmation (stamp/signature) from the custodian bank.

b. A transaction list related to the dividend distributed including confirmation (stamp/signature) from the custodian bank of the shared deposit account. The period covered should be from one month before the day of the AGM (when the dividend was resolved), up to one month after the respective ex-date with the opening and closing balance.

c. A custody account statement related to the dividend distributed for the last cum dividend day (= 1 day before the ex-date) and 1 day before the day of the AGM (when the dividend was resolved) including a confirmation (stamp/signature) from the custodian bank.

Impact on investors

All non-residents are impacted by the changes. The effects are immediate and concern open and new withholding tax applications.

Actions required

For new applications, the taxpayer may consider submitting the additional supporting documentation listed above.

For open claims, in case of insufficient documentation, the tax authorities will contact the beneficial owner or the beneficial owner authorized representative, to request the documents. If you have any questions regarding inquiries received from the tax authorities, please don’t hesitate to contact us.

¹ Also callled declaration/announcement date: the day a company declares a dividend and sets a record date. On this date, a buyer must be registered as a shareholder in the company to receive the dividend.

² The day in which all bought and sold shares will no longer include the right to receive the most recently declared dividend.