Window of opportunity for tax-exempt repatriation of substitute payments in cross border securities lending transactions.
The Tax Adviser › Vol. 23 Nbr. 6, June 1992
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Summary
The lending of securities across international borders and the status of payment of interest and dividends on them is being redefined by the IRS in a series of proposed regulations. Unless otherwise established by treaty or associated with other US holdings, there is a 30% withholding tax on all payments of interest made to owners of borrowed securities. The revisions will reclassify what had been previously called 'other income', effectively removing exemptions for these payments.
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Window of opportunity for tax-exempt repatriation of substitute payments in cross border securities lending transactions.
The IRS has issued proposed regulations under Secs. 861, 871, 881, 894 and 1441 on the source, character and income tax treaty treatment of substitute interest and dividend payments made pursuant to cross-border securities lending transactions. Securities lenders from countries that have treaties wit...
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