Equities – rates, eligibility, availability of relief etc. – Germany
Capital income tax
| Standard tax rate: | 26.375% | Trading restriction: | Yes |
The effective standard tax rate on dividends from German equities comprises a standard rate of 25% capital income tax (Kapitalertragsteuer; KESt) plus a solidarity surcharge (Solidaritätszuschlag; SolZ) of 5.5% of the standard rate.
Availability of relief
Click on the image to view the diagram showing the availability of relief at source and/or reclaim of withholding tax on income from German equities.
| Eligible beneficial owners | Relief at Source | Quick Refund | Standard Refund |
Residents of Double Taxation Treaty countries | No | No | Yes |
Residents of Germany | No | No | No |
Dividends paid to a certified investment fund pursuant to § 1 of the German Investment Tax Act (Investmentsteuergesetz; InvStG)a | No | No | Yes |
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a. Clients holding German taxable securities in their omnibus accounts on behalf of an investment fund that is subject to full company tax rate (“unbeschränkt körperschaftsteuerpflichtig”) in Germany, can request a reduced tax rate of 15% (KESt incl. SolZ) on relevant income payments by providing the status certificate and tax reduction breakdown within 18 months following the taxable income event (§7(5) InvStG). LuxCSD’s domestic depository Clearstream Europe AG will refund the overpaid tax for those beneficial owners (11.375%).
Note: LuxCSD cannot consider a retroactive correction of the character of an income distribution. LuxCSD cannot make any correction regarding the taxability of tax-free payments based on KStG § 27 when changing to a taxable income payment based on EStG § 20,1 or vice versa. This is a matter between the issuer and its local tax office.
Relief at source and quick refund
Relief at source is not available through LuxCSD. Quick refund is available for investment funds with unlimited tax liability (“unbeschränkt körperschaftsteuerpflichtig”) in Germany.
Standard refund
A standard refund is available from the federal central tax office (“BZSt”) if the beneficial owner qualifies for the benefit of a reduced tax rate in accordance with a Double Taxation Treaty (DTT) between its country of residence and Germany.
A reclaim of capital income tax is currently not available through LuxCSD.