The U.S. Qualified Intermediary (QI) regime was introduced by the Internal Revenue Services (IRS) and became effective as from 1 January 2001. On 27 June 2014, the IRS released the Rev. Proc. 2014-39 with the revised QI withholding agreement. The revision was necessary to reflect the FATCA Regime.
The first purpose of the regulations is to identify US persons investing in US securities through foreign intermediaries. Another purposes is to ensure a correct application of the double taxation treaties concluded by the United States, and more generally, of the US withholding tax to be applied to foreign persons.
A Qualified Intermediary is a foreign financial institution such as a bank, broker or asset manager, which pays US source income to its customers and has signed a Qualified Intermediary Agreement (QIA) with the US tax authorities, the IRS. QIs are subject to a set of responsibilities, including.
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