MiKaDiv is finally real – and needs to be on the desk of the head of tax
The publication by the Federal Central Tax Office (Bundeszentralamt für Steuern) of the final version of the MiKaDiv Communication Handbook (in German) as of 10 December 2025 means the framework for the reporting procedure is in technical and processing terms now set in its binding form.
At the same time it is definite that MiKaDiv (Reporting Procedure for Capital Gains Tax on Dividends and Depository Certificates) applies to capital gains received after 31 December 2026, which practically speaking means from 1 January 2027. German paying agents and custodians and domestic listed stock corporations will then have to apply MiKaDiv as the compulsory standard for reporting dividends and identifying shareholders under section 45b(9) of the German Income Tax Act (EStG).
For CFOs, heads of tax, tax operations and regulatory reporting at banks, custodians, foreign financial institutions and issuers this means that MiKaDiv is not a downstream IT topic but a strategic tax and data project. It decides how reliable withholding tax processes will be in future, how efficiently internal tax controls are operating and how well the organisation can connect to the coming EU FASTER regime.
Those who now only implement the minimum requirements of MiKaDiv will later hit their limits when MiKaDiv, FASTER and internal reporting requirements come together. But those who use the final specifications of the Communication Handbook to professionalise data models, interfaces and governance thoroughly, will make MiKaDiv the starting point for a scalable, Europe-compliant withholding tax platform.
What is MiKaDiv and why has it been introduced?
MiKaDiv is the new reporting procedure for capital gains tax on dividends from shares and depository certificates based on sections 45b and 45c EStG and has been introduced by the Withholding Tax Relief Modernisation Act (AbzStEntModG).
The key goals are clearly defined
- Increase transparency in the capital markets
- Prevent abuse of dividend taxation, particularly in cum ex and cum cum structures
- Simplify and standardise relief on capital gains tax with a uniform reporting system
Operationally, MiKaDiv uses digital reporting of extensive data records along the entire custody chain. For each beneficial owner, identification data, amounts and transactions amongst other things are reported concerning the dividend record date as well as the financial intermediaries involved. This is transferred as an XML data record via the ELMA interface with robust technical and content validation.
German paying agents and custodians as well as domestic listed companies that identify shareholders under section 45b(9) EStG in conjunction with section 67d of the German Stock Corporation Act (AktG) and have to report the results to the Federal Central Tax Office (BZSt) must report in particular.
The consequence is clear. If processes do not conform to MiKaDiv, this can mean erroneous reports, delays or blocks on tax relief, increased queries from the tax office and, in extreme cases, sanctions. For tax functions, MiKaDiv is therefore an integral part of the control environment for withholding tax.
Initial findings from the Communication Handbook
The Communication Handbook makes it clear how demanding the operational implementation of MiKaDiv is. The tax authorities now consider the published versions as a binding basis; minor adjustments such as the stricter validation of dates of birth in the XSD are being made in a targeted way.
Three dimensions can be noticed
- Data: The high granularity concerning the beneficial owner, transaction history and custody chain requires clean master data, consistent tax ownership and reliable histories
- Technical: Strictly defined XML structures, validation rules and receipt logic with duties to make corrections require robust interfaces and monitoring
- Organisation: MiKaDiv combined securities, back office, tax, compliance, reporting and IT and thereby compels control models to be function-overarching
For heads of tax the Communication Handbook is therefore less a purely technical document and more a blueprint for data architecture, process design and control system in the withholding tax environment.
MiKaDiv is a mini version of FASTER – strategic forecast and role of Grant Thornton and RAQUEST
In the FASTER Directive the European Union has created standard rules for faster and secure relief on withholding taxes. The Council accepted the Directive on 10 December 2024; it was published in the official journal on 10 January 2025. Member States must transpose the regulations by the end of 2028; the new rules apply from 1 January 2030.
In current articles MiKaDiv is already being described as a mini version of FASTER for the German market, because both regimes rely on digital reports, standardised data schemes and certified financial intermediaries play a strong role. Those who implement MiKaDiv properly thereby practically develop withholding tax processes that will be compliant with FASTER.
This is precisely where Grant Thornton Germany AG and RAQUEST come in. Cooperation with REQUEST allows compliant and automated MiKaDiv reports under section 45c EStG to be submitted to the Federal Central Tax Office (BZSt) and at the same time the technical and specialist basis to be laid for future implementation of the FASTER rules.
Our motto for the coming months is therefore – don’t just comply with MiKaDiv on time; use it as a strategic building block for a European-wide scalable, data-driven withholding tax platform.
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Dieter Kühnel Dieter Kühnel has more than 20 years of experience in financial services tax with particular focus on bank and investment fund taxation, outsourcing and managed services structures and tax compliance.View Profile