In light of the German Investment Tax Act Reform, investment funds with a financial year end other than 31 December 2017 have the possibility to apply a so-called simplified procedure, pursuant to Section 5 (1) InvStG 2004:
The German tax authorities will accept that no correction procedure is necessary when the below listed actual taxable bases do not deviate by more than 30% from the values determined in the simplified procedure:
In the event of redemption of shares prior to 31 December 2017, the German withholding tax is then deducted on the basis of estimates in accordance with 139 of the BMF-Circular of 18 August 2009 (BStBl I S. 931).
Should only one of the aforementioned taxable bases exceed the allowed 30% threshold, the difference between the estimated and actual values must be computed and the correction amount published by 31 December 2018 at the latest. In this case, overpaid withholding tax should be reimbursed or, if too little withholding tax is deducted, a supplement payment is due.
Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.