Progress on new EU rules for harmonised withholding tax procedures
ECOFIN has reached agreement on a proposal for a “Faster and Safer Relief of Excess Withholding Taxes (FASTER)” Directive
ECOFIN has reached agreement on a proposal for “Faster and Safer Relief of Excess Withhold
On 14 May 2024, the Economic and Financial Affairs Council of the EU (ECOFIN) reached agreement on a proposal for a “Faster and Safer Relief of Excess Withholding Taxes (FASTER)” Directive, the draft text of which was first issued in June 2023 and has been subject to lengthy discussions in the Council working groups. Key features of this proposal include:
- A common EU digital tax residence certificate with common content, regardless of the issuing Member State;
- Two fast-track procedures complementing the existing standard refund procedure in each Member State, including: (i) a relief at source system; and (ii) a quick refund system. In-scope Member States will be required to implement one of the two systems (or a combination of both);
- The introduction of National Registers for financial intermediaries that will be able to facilitate the fast-track procedures. Such financial intermediaries will be subject to additional due diligence and common reporting requirements.
Formal adoption by the Council is expected once the European Parliament has given its opinion on the final text. Member States have until the end of 2028 to transpose the Directive into domestic law, with the rules to apply from 1 January 2030.
More detail on this latest development can be found in commentary published by KPMG’s EU Tax Centre.
