BBH Form QIWS (Rev. Jan-2018)
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Qualified Intermediary Withholding Statement (BBH Form QIWS)
Overview:
A qualified intermediary (QI) is required to provide BBH Form QIWS to BBH in order to designate account(s) for which:
1. the QI assumes primary FATCA and NRA withholding / Form 1042-S reporting, and Form 1099 reporting / backup withholding (if applicable);
2. the QI acts as Qualified Derivatives Dealer (QDD) (or, for 2017 and 2018, acts as a Qualified Securities Lender (QSL)), with respect to potential section 871(m) transactions, and is assuming withholding responsibility on dividend equivalent amounts;
3. the QI does not assume primary withholding and reporting responsibilities, and is communicating required information regarding withholding rate pools as defined in the QI Agreement.
A QI that does not elect to assume primary withholding responsibility for purposes of the Foreign Account Tax Compliance Act (FATCA) must indicate the amount of any withholdable payments that are allocable to recalcitrant accountholders and Nonparticipating Foreign Financial Institutions (NPFFI) and that are subject to FATCA withholding.
And, if a QI is pooling assets for U.S. non-exempt investors, and is not assuming Form 1099 reporting and backup withholding responsibility, copies of Forms W-9 for each U.S. investor are also required, unless the QI is eligible and chooses to place such customers in a Chapter 4 pool of U.S. payees.
Finally, per IRS regulations, a QI shall update BBH Form QIWS as often as necessary in order to ensure that the QI’s reporting and withholding obligations are met.
Important Notes:
1. As a result of the revised QI Agreement published by the IRS on 30-December 2016, a QI assuming primary withholding responsibility under Chapter 3 and Chapter 4 or primary 1099 reporting and backup withholding responsibility will now need to complete this form [EXCEPTION: A QI that assumes both primary withholding responsibility under Chapter 3 and Chapter 4, as well as primary Form 1099 reporting and backup withholding responsibility, is not required to complete this form.]
2. A QI can only assume primary withholding responsibility with respect to 305(c) deemed distributions where upstream withholding agents provide them with information contained on an issuer’s Form 8937.
3. If the QI is NOT assuming primary withholding responsibility, indicate only one "Pool Type" in Section C of this form, and complete either Section D or Section E (as applicable).
4. Shaded yellow sections on the BBH Form QIWS are required and must be completed.
5. Please e-mail any questions regarding this document to BBH’s Global Tax Services Department ().
6. Statutory withholding rates shall apply to U.S. source income payments not specified on this form. This also includes effectively connected income (ECI) resulting from a publicly-traded partnership distribution subject to IRC Section 1446 (at 37% for individual account holders or 21% for corporate account holders, or the prevailing ECI withholding rate).
7. The designated rate for Chapter 3 (NRA) withholding should be 0%, 30%, or a rate derived from Table 1 of IRS Publication 515 based on the demographics/documentation of the QI’s account holder(s).
8. If the QI indicates that backup withholding should be applied to a U.S. account, the withholding rate applied will be the prevailing backup withholding rate.
9. FOR ALL CLIENTS ELECTING THE QUALIFIYING DERIVATIVES DEALER (QDD) ACCOUNT TYPE:
· By electing the QDD account type, the account holder confirms all securities settled in custody in this account, and all transactions into or out of the account, occurs in the account holder’s capacity as a QDD. As required by the regulations, a QDD assumes all US withholding obligations for payments derived from 871(m) transactions. Please complete the ‘QDD Account Certification’ on page 3.
· For payments received on or prior to December 31, 2018, payments of actual dividends or dividend equivalents are subject to 0% US withholding tax. BBH will solicit the appropriate withholding certificate (i.e., Form W-8) from QDD account holders in 2017 and 2018 to ensure the applicable US withholding rate for all other income types (e.g., interest) paid to the account reflect the appropriate withholding tax rate for the proprietary assets of the QDD. For payments of actual dividends received on or after January 1, 2019, BBH will apply the appropriate withholding tax rate.
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BBH Form QIWS (Rev. Jan-2018)
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Qualified Intermediary (QI) Withholding Statement
Section A: Certification
I certify under penalties of perjury that the information contained herein is true, correct, and complete.
Type Name of Authorized Signer:Signature of Authorized Person:
Today’s Date:
Section B: General Account Information
Qualified Intermediary Name:Qualified Intermediary EIN / GIIN:
BBH Account Name:
BBH Account Number:
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BBH Form QIWS (Rev. Jan-2018)
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Section C: Designation of Account Type (Please select only one box for this section.)
Underlying Non-U.S. Clients / Underlying U.S. ClientsChapter 3 Exempt Pool
- Not subject to Chapter 4 withholding
- Documented for NRA withholding exemption
- Must complete Section D / Exempt Recipients Pool
- Not subject to Chapter 4
- Exempt from backup withholding and Form 1099 reporting
Chapter 3 Treaty Pool
- Not subject to Chapter 4 withholding
- Documented clients eligible for NRA treaty withholding relief
- Must complete Section D / Non-exempt Recipients, Documented Pool
- Not subject to Chapter 4
- QI elects to use the Alternative Procedure
- QI must supply copies of Forms W-9 for each payee
Chapter 3 Non-treaty Pool
- Not subject to Chapter 4 withholding
- Documented clients NOT eligible for NRA treaty withholding relief
- Must complete Section D / Non-exempt Recipients, Undocumented Pool
- Not subject to Chapter 4
- QI elects to use the Alternative Procedure
- QI provides the name, address, and TIN (if available) of each payee subject to U.S. backup withholding
Chapter 3 Undocumented Pool
- Not subject to Chapter 4 withholding
- Most income will be subject to 30% NRA withholding
- Must complete Section D / Non-exempt Recipient, Segregated Account
- All assets in the account belong to a single beneficial owner
- QI must supply a copy of the Form W-9 for the payee
Chapter 3 Payment Based Allocation Method
- Not subject to Chapter 4 withholding
- Withholding rate(s) supplied by QI for each dividend payment attributable to documented clients
- Must complete Section D / Primary Withholding Responsibility
- Not subject to Chapter 4
- QI assumes primary Form 1099 and backup withholding responsibility
Primary Withholding Responsibility
- QI assumes primary withholding responsibility for purposes of Chapters 3 and 4 / Chapter 4 Pool of U.S. Payees
- QI certifies that it will fulfill FATCA reporting with respect to underlying U.S. clients
- BBH will report to the QI on Form 1042-S
- Disclosure of clients and Forms W-9 are not required
Primary Withholding Responsibility
- Not subject to Chapter 4 withholding
- QI assumes primary withholding responsibility for U.S. source substitute interest income ONLY
Section C: Designation of Account Type – CONTINUED (Please select only one box for this section.)
Qualified Securities Lender / Qualified Derivatives Dealer
Qualified Securities Lender (QSL) (2017-2018)
- Not subject to Chapter 4 withholding
- QI assumes primary withholding responsibility for U.S. source substitute dividend income ONLY
- Must complete Section D / Qualified Derivatives Dealer (QDD)
- Not liable for tax on dividends on physical shares or on dividend equivalents
- QI assumes primary withholding responsibility for U.S. source income from dividend equivalent amounts ONLY
-Not subject to Chapter 4 withholding
- Must complete Section D and QDD Certification
Underlying Non-U.S. / U.S. Clients (SUBJECT TO FATCA WITHHOLDING)
Recalcitrant Pool
- Subject to Chapter 4 withholding
- Must complete Section E / Nonparticipating FFI Pool
- Subject to Chapter 4 withholding
- Must complete Section E
Section D: Designation of Chapter 3 (NRA) Withholding Rates
Underlying Non-U.S. Investors
Income Type / Chapter 3 Income Code / Chapter 4 Exemption Code* / Chapter 3 Withholding Rate
Interest
Interest (eligible for portfolio interest treatment) / Substitute interest / 01 / 33 / 15 or 19 / %
Interest (NOT eligible for portfolio interest treatment) / Substitute interest / 01 / 33 / 15 or 19 / %
Original issue discount (OID) / 30 / 15 or 19 / %
Interest (residual) paid on real property mortgages / 02 / 15 or 19 / %
Dividends
Dividends / Substitute dividends / Dividend equivalents
Note: Where QI indicates in Section C that it is a “Qualified Securities Lender”, or a Qualified Derivatives Dealer BBH will apply the instruction of a 0% (zero) rate to substitute dividend income (Income Code 34) and dividend equivalent payments (Income Code 40), respectively. / 06 / 34 / 40 / 15 or 19 / %
REIT dividends (and capital gains treated as REIT dividends) / 06 / 15 or 19 / %
Other
Royalties (real property income and natural resources) / 14 / 16 / %
Publicly-traded Partnership distributions (subject to IRC Section 1441) / 23 / 15 or 19 / %
Other Income (e.g., consent fees and any other income not specified within the QI withholding statement, such as that covered by the “Other Income” articles of relevant income tax treaties) / 23 / 15 or 19 / %
* Please indicate Chapter 4 Exemption Code 15 or 19, as appropriate.
Section E: Designation of Chapter 3 (NRA) Withholding Rates (Grandfathered Debt Instrument Income)Underlying Non-U.S. / U.S. Clients (SUBJECT TO FATCA WITHHOLDING)
All Reportable Amounts / Chapter 4 Exemption Code / Chapter 4 Withholding Pool Rate / Chapter 3 Withholding Pool (Portfolio Interest)* / Chapter 3 Withholding Pool
(Non-portfolio Interest) / Chapter 3 Withholding Pool
(Other Income)
Nonparticipating FFI Pool (Subject to FATCA withholding) / 00 / 30.00% / % / % / %
Recalcitrant Accountholder Pool (Subject to FATCA withholding) / 00 / 30.00% / % / % / %
Supplement / 2017 and Forward Qualified Derivative Dealer (QDD) Certification
Under penalties of perjury, I declare that all assets settled in this custody account, in addition to, payments received into and made from this account, are proprietary assets and transactions of the account holders for potential 871(m) transactions in its capacity as a Qualified Derivatives Dealer (QDD)
The account holder confirms the certifications therein remained the same and unchanged beginning _____/______/_____ [insert date (MM-DD-YYYY) from the start of the applicable period] through the present, and were true,correct and complete during this period. I understand that BBH will use this certification to determine the amount of U.S. tax from payments made to me during the above period.
Whereby the account holder is aware of a change in circumstance of the use of this account for purposes other than acting in its capacity as a QDD, the account holder will notify BBH immediately of the change, and provide instruction to segregate non-QDD assets in a new custody account.
Print Name
Signature of Authorized Official
Date (MM-DD-YYYY)
For account holders electing QDD under Section C of this form ONLY:
q I certify that I have the capacity to sign for the entity identified in Section B
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