Germany: Implementation of the OGAW-IV Umsetzungsgesetz (UCITS IV Directive) Part II (revised, with updated csv file attachment)

(First published 23 January 2012) Further to our Announcement A11152, dated 14 October 2011, we hereby provide information about the following:

• German tax voucher application process;
  
• Reporting of tax liability events;
  
• Short entitlements on German dividend payments and fund distributions (cash and accumulation).

Application for a tax voucher

The Clearstream Banking¹ customer can file an application for a single tax voucher (“Einzelsteuerbescheinigung”) with respect either to their own assets or to their client’s assets.

An application for a German tax voucher with respect to a client’s assets must normally be made via electronic upload of a data file (see Upload BO List on our website) in the name of beneficial owner/end-investor of the capital income. Only on an exceptional basis will Clearstream Banking accept an application in writing via Antragsformular auf Bescheinigung der Kapitalertragsteuer (see attached PDF file).

Tax vouchers are issued after the completion of the market claims-process (25 business days after payment date). The fee for the issuance of a German tax vouchers can be derived from the Clearstream Banking Fee Schedule in effect at the relevant time.

If the tax amount to be certified in the tax voucher(s) requested by a Clearstream Banking customer (on their own behalf or on behalf of their client(s)) exceeds the amount of the tax actually deducted for an event, Clearstream Banking will reject the issuance of a voucher.

Furthermore, the current Recovery Directive Implementation Act (Beitreibungsrichtlinie-Umsetzungsgesetz ("BeitrRLUmsG")²) provides for an accumulative tax voucher („Sammelsteuerbescheinigung“) used in the context of the refund, by the domestic credit institution and ultimate custodian, of withholding tax that has been retained twice (if given). The application for the issuance of such a voucher may only be filed for shares that were acquired „cum-dividend“ and delivered „cum-dividend“ (that is, so-called “cum-cum-constellation”; „cum-ex-trades“ are not covered).

Clearstream Banking treats an accumulative tax voucher like a single tax voucher. The application for an accumulative tax voucher suspends the issuance of a single tax voucher (including the forwarding of the application for a single tax voucher) for taxes retained on the same capital income. CBF will issue accumulative tax vouchers according to the legal requirements and will mark each accumulative tax voucher as such.

The Clearstream Banking customer must earmark the application for a German tax voucher as one of the following:

• Application for single tax voucher:
  

• Official template I from the German Tax Authorities for personal assets (Privatvermögen); or
  
• Official template III from the German Tax Authorities for funds from business capital (Betriebsvermögen – see attached example); or

• 
  
• Application of accumulative tax voucher:
  

• Official template IV from the German Tax Authorities (see attached example).

In letter IV C 1 - S 2401/08/10001:007 (DOK 2011/1041094) from 29 December 2011, the German Ministry of Finance (MoF) published the final draft of the accumulative tax voucher, requiring that it show the following:

• The original date of request by the German depository that asked for the accumulative tax voucher; and
  
• The name and address of any other subcustodian(s), the Clearstream Banking customer being the first subcustodian in the depository chain.

Note: If the Clearstream Banking customer does not provide details about the type of request in the form of a single or accumulative tax voucher (whether it is with regard to business capital or to personal assets), then Clearstream Banking must assume that application is made for a single tax voucher for an individual person with regard to personal assets/Privatvermögen based on Einkommensteuergesetz (EStG).

In the case of an application for an accumulative tax voucher, Clearstream Banking assumes that the day of the data file transfer or date of issuance of the application form will be the date of application of the German depository that asked for the accumulative tax voucher.

Reporting tax liability events

In line with previous legislation, the capital investment trust forwards the tax liability for capital growth funds to the tax office. This obligation is being transferred to Clearstream Banking in the wake of the UCITS IV Directive. Please refer to our Announcement A11152.

CBL customers (including CBF International customers) are considered as foreign residents and will receive the tax liability reduced by the withholding tax and solidarity surcharge. In the tax liability assessment, this can result in a reduced tax liability of EUR 0.00 based on business capital.

CBL will report tax liability events as non-taxable cash events with CAEV code DVCA. The details of the relevant tax component are listed in the Narrative field :70E: of the SWIFT message as follows:

TAX LIABILITY ON GERMAN ACCUMULATION FUNDS CASH PAYMENT OF CHURCH TAX. WITHHELD TAX COMPONENTS:
ESTATE (Amount)
INTEREST (Amount)
DIVIDEND (Amount)

NOTE: THE CALCULATION FORMULA OF CHURCH TAX RATE IS: TAX LIQUIDITY RATE – (SUM OF DIVIDEND PART / REAL ESTATE PART / INTEREST PART * 0.26375)

Short entitlement and manufactured dividends

On recognising a „short entitlement“ of a German equity or fund, CBL will, according to its general terms and conditions (please see section 4.6. of the Clearstream Banking Customer Handbook (Governing Document)) debit its customers (including CBF International customers) with the amount of difference between the net and the gross dividend or cash amount by German accumulation funds.

CBL will debit customers by short entitlements on the 5th day after Ex-date of the relevant event with the tax amount of short entitlement and will either do the necessary tax adjustments by totalling long positions at the end of the market claim period or do further necessary debits for short entitlements on the 25th (end of market claim period in Germany) day after Ex-Date of the relevant event without any pre-notification.

Clearstream Banking will inform customers about processing on „manufactured dividends“ after final discussion with the MoF in Berlin and the state tax authorities in Germany. Chapter „Bescheinigung und Erstattung der Kapitalertragsteuer bei Leerverkäufen im Ausland“ from the CBF document „Bescheinigung und Erstattung/Entlastung von einbehaltener Kapitalertragsteuer und des Solidaritätszuschlags“ dated 23 November 2011 is therefore on hold.

Further information

For further information, please contact the Clearstream Banking Tax Help Desk on:

or Clearstream Banking Customer Service or your Relationship Officer.

1. Unless explicitly stated otherwise, Clearstream Banking refers collectively to Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in the Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500 (CBF) and Clearstream Banking, société anonyme, registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Register of Commerce and Companies under number B-9248 (CBL). However, the tax duties under the UCITS-IV transformation act refer primarily to Clearstream Banking AG, it being registered in Frankfurt am Main.
2. Please see Deutscher Bundestag Drucksache 17/7469 (pdf).