On March 6, 2018, the German BMF (Federal Ministery of Finance) published a draft circular describing the new regulation for multi-investor special funds. This BMF letter was commented upon by BVI on March 27, 2018.
Please find below a summary of the draft letter:
- The unrealized P&L of all instruments need to be stored with end of year 2017 and the P&L calculation for 2018 must take the market value of 31.12.2017 as cost price. For holdings bought before 01.01.2018, the P&L needs to be split for the time before 01.01.2018 and after.
- The P&L calculation is done as of today. The complicated calculation per periods between subscriptions proposed by BMF last year is no longer required.
- The ownership related income allocation for the P&L will be done in the same way as for dividends (the realized P&L will be split proportionally between the investors invested in the multi-investor special fund at the day of the sale).
- The taxable amounts of the distribution will be different per investor as the ownership related income allocation will be the basis.
- Under this regime, different values per investor are in the tax statement and the share profit will be different per investor.
- The share profit needs to be available end of this year and must be calculated from the beginning of this year.
For further details, please download our white paper on the topic here.