If you are trading instruments issued by a US issuer, be it corporate or a government, it is crucial to grasp the ins and outs of the US tax system.
How can I qualify for a reduced US tax rate (if applicable)?
The applicable tax rate is determined based on your tax residency, as specified in the respective tax treaty agreement and the specific terms outlined in the relevant tax treaty agreement. In order to obtain a reduced tax rate, you need to provide EXANTE with a valid W8 form.
How long does a W8 form remain valid?
A W8 form remains valid for 3 years.
Is the tax rate on coupons dependent on my tax residency?
No, the coupon tax rate is 0% if you qualify for the portfolio interest exemption and have a valid W8 form. Your tax residency does not impact this rate.
When does EXANTE apply the tax rate specified in the W8 form?
EXANTE begins applying the tax rate specified in your form after the date you submitted the valid form.
How does EXANTE handle my taxes at year-end?
At the end of each year, EXANTE considers the most recent valid W8 form and recalculates all taxes for that particular calendar year, based on the information provided in the form. In addition to considering the most recent W8 form, tax recalculations can also be triggered by income corrections or reclassifications, updates to applicable tax treaty rates, or late income allocations. These adjustments ensure the accuracy of your tax obligations in compliance with U.S. tax laws.
When can I expect to see the tax recalculation reflected in my account?
The result of your tax recalculation, be it a reimbursement or an additional charge, will be posted to your client account no later than the end of May in the following tax year. For example, tax calculation for the year 2025 will be applied to your account by the end of May 2026.
Can I request EXANTE to retroactively recalculate taxes for the current year?
Yes! If you have submitted a valid W8 during the year and wish to have taxes retroactively recalculated for the ongoing year, you can make a request to your account manager. Keep in mind that this recalculation only affects income sources such as coupons, dividends, and partnership distributions for the current year. The cost of this service amounts to 90 EUR.