Investing in U.S. Securities - An Introduction to U.S. Withholding Taxes, QI and FATCA

This book provides an in-depth reference on US withholding and information reporting for non-US financial institutions.

Why this book?

The sheer complexity of the framework that the United States has created to levy US withholding tax on income from US securities owned by foreigners makes it difficult to obtain insight into the key relevant items, the logic behind the framework and the decision points and consequences for the tax operations of a non-US financial institution. Yet, since the US stock market is nearly one half of the global market by market capitalization, there is no escape for internationally diversified investors from investing in the US equity market and for their non-US banks or asset managers to help them in doing so. For the US government, there is an incentive to create a framework that both encourages foreign capital to be invested in the United States and ensures that the proper taxes are paid within a framework that is understandable and reasonable, from a cost perspective, to comply with.

In clarifying this framework in the context of the tax operations of a non-US financial institution, this book intends to provide a general overview and a mix of high-level insights into the logic behind the framework (including for FATCA, qualified intermediaries, dividend equivalent payments under 871m and qualified derivatives dealers) and, where appropriate, takes a deeper dive into detailed compliance rules.

The book addresses issues relevant for the tax operations departments of non-US financial institutions, qualified intermediaries and their tax advisers.

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Author(s)

Ton Daniels has over 25 years of experience in international tax matters for the financial services industry. He is a senior policy adviser at the Dutch Banking Association and acts as independent non-executive director. He was a partner in the Amsterdam tax practices of Baker McKenzie and Ernst & Young. Previously he taught international and EU tax law at Maastricht University, Utrecht University and Nyenrode Business University. He holds a PhD in International Tax Law from Tilburg University.

Toine Gorissen is a subject matter expert in the corporate compliance department of ING Bank NV. Previously he worked at Ernst & Young advising the financial services industry on tax transparency, operational taxes and technology. He holds a master’s degree in Tax Law from Tilburg University.