The present newsletter aims at providing an update on withholding tax (“WHT”) reclaims filed in Austria based on domestic law.
The competent tax office Bruck-Eisenstadt-Oberwart (“The Tax Office”) rejected WHT reclaims based on domestic law filed by Luxembourg SICAVs (“The Claimants”).
The Claimants have legal personality and are considered non-transparent for tax purposes. However, the Tax Office regarded SICAVs as equivalent to Austrian Investment Funds, which are necessarily tax transparent. Therefore, the Tax Office considered that the WHT reclaims should not have been filed by the claimants themselves, but by their investors.
KPMG is filing administrative recourses against these decisions of rejection as, in line with the position of the Supreme Austrian Administrative Court, we take the view that non-resident corporate funds (i.e. SICAVs) should rather be compared to Austrian corporations (which are non-transparent) (please refer to our Aberdeen e-alert 2014-7 for more information).
Please note that all the recourses are now put on hold by the Austrian tax authorities, as another decision from the Supreme Austrian Administrative Court (Zl. 2013/13/0116) is expected to clarify the regime of non-resident investment funds.
We would advise non-resident SICAVs to keep on filing WHT reclaims and to file an appeal against the potential decision of rejection.
This would keep the claimants’ rights alive until the decision of the high administrative court is rendered.
For further information, please do not hesitate to contact us.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.