Mandatory reporting of shareholder data from 2025

Under the German Withholding Tax Relief Modernisation Act, listed companies based in Germany are obliged to report information on the identity of their shareholders to the Federal Central Tax Office (BZSt) for the first time from 2025. This includes details such as name, address, date of birth, tax number, email address, number of shares held and the start date of the shareholding. 

The notification must be made immediately at the time of the profit distribution resolution, usually the Annual General Meeting. The shareholders must be informed of the notification. There are currently (as of March 2024) no fines for violating the reporting obligation, but these are being planned. Companies also risk reputational damage.

The BZSt recently published a communication manual with detailed information on implementation. Companies can now use this to take measures to implement the reporting obligation. A corresponding test environment has been announced for June 2024. 

Companies already had the option of obtaining shareholder data from well over 1,000 central securities depositories or banks (so-called "intermediaries"). However, only very few have made use of this option in practice, as shareholder data could previously only be collected on a voluntary basis and for non-tax reasons in accordance with the German Stock Corporation Act. 

The tax reporting obligation now turns this voluntary data collection into an obligation for which very few companies will be prepared. In most cases, the necessary processes and interfaces must first be set up. The XML mass data interface required for the subsequent reporting to the BZSt is also not yet available at many companies. Finally, communication with shareholders should also be ensured by implementing suitable processes.

With the new reporting obligation, the BZSt aims to recognise and avoid tax arrangements around the dividend record date at an early stage, as in the case of cum-cum/cum-ex transactions. To this end, the shareholder data transmitted by the companies will be compared with the information provided by domestic banks as part of the electronic transmission of tax certificate data. In this way, the beneficial owner of the dividend (beneficial owner at the time of the profit distribution resolution) is to be specifically identified.