NEW: Calculation of Equity Participation (InvStG)
We handle the daily calculation of the equity participation ratio, continuously monitor threshold compliance, and provide the required documentation. This helps reduce the burden on your fund accounting and tax teams while safeguarding your investors’ eligibility for the partial tax exemption.
The equity ratio — referred to as the equity participation ratio under the German Investment Tax Act (InvStG) — is a key factor in determining a fund’s tax classification. To qualify as an equity fund, a fund must continuously invest more than 50% of its assets in qualifying equity participations in accordance with its investment terms. For mixed funds, the threshold is at least 25% (Section 2(6) and (7) InvStG).
But determining the ratio is far from a simple asset-class exercise. Every position must be assessed individually, taking into account factors such as stock exchange listing, legal form, tax residence and the effective taxation of the underlying corporation, the distinction from real estate companies, as well as the 10% thresholds applicable to indirect participations.
Fenion turns this complex regulatory calculation into a seamless outsourced process. We determine the equity participation ratio on every valuation day, assess each individual position, and maintain a complete historical audit trail — giving your teams reliable data, robust documentation and confidence in the fund’s tax classification.
We offer
- Equity participation ratio by fund and share class
Calculation for both equity funds and mixed funds
- Assessment under Section 2 (8) InvStG
Including tax residence and taxation checks
- Multi-level look-through
Or use of published actual equity participation ratios
- Early warning before threshold breaches
Including buffer reporting and automated alerts
- Comprehensive data enrichment
Comprehensive enrichment of all required reference and master data
- Dissemination of calculation results
Delivery to WM Datenservice and other data vendors
- ISO 27001 certified & DORA compliant
With audit-ready processes and documentation
