Market Taxation Guide - Germany

02.01.2020

This Market Taxation Guide (Germany) provides the following details:

  • Reference information about all taxes applied at source, through Clearstream Banking and its local depositories, to securities deposited in Clearstream Banking; and
  • Instructions for obtaining relief at source or a refund of withholding tax, where these are available, through Clearstream Banking.

New and improved tax information and procedures that become available will be included on an ongoing basis.

Important note:

This Market Taxation Guide (including any attachments and other links) is for informational purposes only and is not intended and should not be considered to be legal advice on any subject matter. Readers of this Market Taxation Guide, whether customers or otherwise, should not act or refrain from acting on the basis of any information included in this Market Taxation Guide without seeking appropriate legal or other professional advice.

Withholding tax

There is an effective withholding tax rate of 26.375%, which comprises a standard rate of 25% plus a solidarity surcharge (Solidaritätszuschlag; SolZ) of 5.5% of the standard rate.

Debt securitiesTrading
restriction?
Withholding tax rateRelief at
source
Quick
refund
Standard
refund
Yes0% / 26.375%
Residents of Double Taxation Treaty (DTT) countriesNoNoYes
Residents of GermanyNoNoNo
Coupon payments subject to German withholding tax paid to a foreign investment fund pursuant to § 1 of the German Investment Tax Act (Investmentsteuergesetz; InvStG)YesNoYes
EquitiesTrading restriction?Withholding tax rateRelief at
source
Quick
refund
Standard
refund
Yes0% / 15% / 26.375%
Residents of Double Taxation Treaty (DTT) countriesNoNoYes
Residents of GermanyNoNoNo
Dividends payments subject to German withholding tax paid to a foreign investment fund pursuant to § 1 InvStGYesNo

Yes

a. If a foreign investment fund obtains and provides a Fund Status Certificate for classification of the fund pursuant to § 1 InvStG, the German withholding tax (Kapitalertragsteuer; KESt) will be reduced to 15% at source irrespective of the location of the fund. If the Fund Status Certificate is submitted after the payment date of the event, the overpaid KESt  amount (11.375%) can be reclaimed from Clearstream Banking AG (CBF) within a period of 18 months. The Fund Status Certificate must be requested from the German Tax Authorities (in most of cases from the Federal Central Tax Office (Bundeszentralamt für Steuern; BZSt). 

German funds

Trading restriction?Withholding tax rateRelief at
source
Quick
refund
Standard
refund
Yes0% / 26.375% a
Residents of Double Taxation Treaty (DTT) countriesNoNoYes
Residents of GermanyNoNoNo

a. From 1 January 2018, no KESt and SolZ are deducted by Clearstream Banking for fund distributions of German funds, if evidence is provided that the fund is an investment fund pursuant to § 1 InvStG or a special investment fund pursuant to § 53 InvStG. For funds not certified accordingly the current tax deduction logic is applied; if no taxation base parts are delivered, the income amount is taken as the taxation base.

Capital gains tax

There is no capital gains tax withheld through Clearstream Banking on securities held in Clearstream Banking. Capital gains tax may however be payable on specific gains. Clearstream Banking does not assist in this regard. Please consult your tax advisor for further information.

Stamp duty

There is no stamp duty withheld through Clearstream Banking on securities held in Clearstream Banking. Stamp duty may however be payable on specific transactions. Clearstream Banking does not assist in this regard. Please consult your tax advisor for further information.

Trading restriction

The Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA D) of the U.S. Inland Revenue Service makes it unlawful for the issuer of the affected securities or the sales partners of such issuer to sell those securities, within 40 calendar days of issue, to a U.S. citizen or to any persons who have spent more than 183 days in the U.S.A. (thus qualifying as U.S. residents for tax purposes).