Factsheets - Qualified Indices under Section 871(m)

Qualified Indices under Section 871(m) of the US Internal Revenue Code and Treasury Regulation Section 1.871-15

Section 871(m) of the Internal Revenue Code (26 USC 871(m)) seeks to ensure that non-US persons cannot avoid withholding tax on US-sourced dividend payments through the use of financial derivatives. Save for the exemption provided by Treasury Regulation 1.871-15, such financial derivatives could include derivatives on financial indexes.

To assist our index subscribers in undertaking a compliance review of the financial indexes that form the basis of financial derivatives, FTSE Russell has published a statement that summarises certain information relating to FTSE Russell indexes that may be relevant to a subscriber's consideration of its position in relation to Section 871(m) of the US Internal Revenue Code and Treasury Regulation Section 1.871-15.