European withholding taxes on dividends are taxed at source. This means that the tax is withheld by the depository prior to remittance of the distribution to us and the subsequent credit of the net distribution to the accounts of any clients.
As outlined in the client agreement, we hold all shares in street name. For this reason the rate between the dividend paying country (France) and the receiving country (IB LLC US) is 28% for 2020 (reduced from 30% for 2019). While you may hold an account with Interactive Brokers UK, IBUK in turn acts as an introducing broker for Interactive Brokers LLC. As such, Interactive Brokers LLC is the street facing holder of shares. See the below link to our Customer Agreement for further clarification. In case the link does not work, find the Forms and Disclosures link at the bottom of our website and select Agreements followed by Customer Agreements and IB UK Limited Customer Agreement:
On French stock dividends, we can facilitate the process of dividend tax reclaim. To reclaim taxes you are required to complete Forms 5000 and 5001. Please return the completed forms to us initially as an attachment to an Inquiry Ticket. Upon receipt, we will review the forms and confirm if they can be accepted. Once reviewed, the original forms should be sent to:
ATTN. Tax Reclaim
North One Dock
North wall Quay
In Form 5000 you have to fill out only the first page.
At point I please select "Normal procedure".
At point II please complete with your personal details.
At point III please write your signature
At point IV is required your Tax ID Number and the Signature/Stamp of your local Tax Office.
In Form 5001 complete the second page with the corresponding shares and dividend details (incl. ISIN). Please ensure the completed form is signed.
Please note the forms 5000 and 5001 provided to us should be those for the French tax authorities. In the box on the top left of the forms you can see the version of the forms. They need to be the ones 'for the use of the French tax authorities', and not the versions 'to be kept by the beneficiary' or 'for the use of the foreign tax authorities'.
Upon receipt of the original forms, we will forward the documents to our custodian for the French market. Upon receipt of the refunded withholding tax, we will credit the account.
Please note that an external fee of 125 EUR per each dividend is charged by Euroclear for processing the reclaim. This fee is charged regardless of whether the refund is successful or not.
The process of tax reclaims is handled on a best effort basis and could take several months (6 to 12).
The deadline to request a French Tax Reclaim is two years from the end of the year of the dividend payment event with an exception for residents of the Netherlands (three years) and Germany (four years).
Please send us the original forms before the end of October of the deadline year to ensure that Euroclear will have the documents. Documents received by Euroclear after 15 November of the reclaim deadline year will be processed on a best efforts and will incur a higher fee of 200 euros per dividend payment.
French ADR Withholding Tax Reclaim
We do not support ADR Tax Reclaims. GlobeTax can be a solution to reclaim the ADR Withholding Tax. Please see the contact details below: