Germany extends status certificate renewal period

A welcome development for withholding tax relief at source

A recent legislative change in Germany is drawing attention within the investment fund industry, as it introduces greater flexibility in the renewal of the status certificates used to access withholding tax relief at source.

An amendment to the German Investment Tax Act (InvStG), effective 10 February 2026, allows for a longer validity period for renewed status certificates, potentially reducing the frequency of renewal procedures for eligible investment funds investing in Germany.

This development illustrates how incremental regulatory changes can create practical opportunities for funds, reinforcing the importance of closely monitoring developments affecting relief at source mechanisms across investment jurisdictions.

Key developments

Pursuant to Section 7 (4) sentence 2 InvStG, the validity period for status certificates is now defined as follows:

Initial application:

a status certificate valid for up to three years
Subsequent renewals:

validity may be granted for up to five years

While the duration of the initial certificate remains unchanged, allowing renewals for up to five years represents a notable extension compared with previous practice, where renewal periods were generally shorter.

What this means for investment funds

Status certificates play an important role in enabling certain investment funds to benefit from withholding tax relief at source in Germany.

The extension of the renewal period may therefore provide several operational advantages, including:

Reduced administrative burden due to less frequent renewal applications
Greater predictability in managing withholding tax documentation and compliance timelines
Operational efficiencies for asset managers, custodians and fund administrators managing German withholding tax procedures

Funds should nevertheless ensure that eligibility criteria and supporting documentation underlying the status certificate remain accurate throughout its validity period. In particular, any changes that may affect the fund’s status should be communicated to the German tax authorities, as the certificate is granted based on the information provided at the time of application.

KPMG insight

KPMG continues to actively monitor relief at source opportunities for investment funds across multiple jurisdictions worldwide. Withholding tax frameworks are evolving rapidly, and legislative updates, administrative practice changes, and procedural improvements can create opportunities for funds to access relief more efficiently.

Developments such as the recent amendment to German legislation highlights the importance for investment funds, asset managers and service providers to stay informed of changes that may impact withholding tax processes. Proactively monitoring such developments may help identify opportunities to optimize tax procedures, reduce administrative complexity and enhance operational efficiency.

How KPMG can help

The fund tax specialists at KPMG Luxembourg support investment funds, asset managers and service providers in navigating evolving relief at source frameworks, including:

Monitoring global relief at source developments and identifying relevant changes
Assessing eligibility for withholding tax relief mechanisms
Managing status certificate applications and renewals
Supporting the implementation and optimization of withholding tax processes

By combining ongoing regulatory monitoring with practical implementation support, KPMG helps clients identify opportunities arising from changes in withholding tax frameworks and ensure efficient access to relief at source mechanisms.

If you would like to discuss how this development may affect your fund structures or German investments, please reach out to your usual KPMG contact.