US Taxation and Refund of German Withholding Tax | Daimler > Investor Relations > IR Services > Questions & Answers

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Questions & Answers regarding dividends and taxation

US Taxation and Refund of German Withholding Tax

Why are German taxes withheld from the dividend payment in 2012?

Under German law, German company dividends are subject to a 26.375% German withholding tax. Under the terms of the Germany-U.S. Income Tax Treaty (the “Treaty) however, U.S. shareholders may be refunded up to 11.375% of the withholding tax from the German government. Qualified U.S. pension funds, which are eligible under the Treaty, may be refunded the entire 26.375% withholding tax. Under U.S. law, U.S. shareholders may be able to claim a foreign tax credit or itemized deduction on their U.S. Federal income tax return for the non-refundable 15% remainder. In the case of a U.S. resident taxpayer, 100% of the dividends from the company are considered from foreign source. Additional U.S. Federal tax treatment is addressed below. Summary of German Withholding Tax Paid and Refund and Foreign Tax Credit Available for U.S. Shareholders (Not applicable to Daimler stock held in a pension fund).

German Withholding Tax	26.375%
Less: Refundable Portion from German Tax Authorities	11.375%
Amount Eligible for U.S. Foreign Tax Credit	15.0%

German company dividends paid to qualified U.S. pension funds may now be exempt from German withholding tax under the revised Treaty. The applicable plan sponsor or trustee should seek professional tax advice to make the determination, if the U.S. pension fund would qualify for the tax exemption under the Treaty and request the withholding tax refund, if applicable, and as a result, U.S. shareholders with Daimler stock held in a qualified U.S. pension fund should automatically receive a credit in their account for the refund of the 26.375% German withholding tax.

What process do U.S. shareholders utilize to obtain a refund of the 11.375% of German taxes withheld on any dividends paid in 2012 or future years?

If you are holder of ordinary Daimler shares and you claim the refundable portion directly from German tax authorities, then you must submit a special claim. Your refund claim must include the original tax voucher that you received from the custodian bank if you have filed an application for a single tax voucher. This voucher must show the amount of tax that was withheld. You must submit your claim within four years from the end of the calendar year in which you received the dividend. You can obtain a form for your claim for refund from:

(i) the German tax authorities at the same address where you would file any refund claim, which is:

Bundeszentralamt für Steuern
Department St I 9
An der Küppe 1
D-53225 Bonn
Germany

Contacts for foreign investors
Tel. +49(0) 228-406-1212
Fax +49(0) 228-406-3119

www.Germantaxes.info

The German tax authority offers a subsite for "foreigners"

(ii)
the Embassy of the Federal Republic of Germany,
4645 Reservoir Road, N.W.,
Washington, D.C. 2007-1998.

If you have not done so within the last three years, you must also submit to the German tax authorities IRS Form 6166, Certification of United States Residency. A shareholder seeking the Form 6166 certification must complete IRS Form 8802, Application for United States Residency Certification. A user fee is charged by the IRS to process Form 8802. The user fee is $35 for a request for up to 20 original Forms 6166 issued under a single taxpayer identification number (“TIN”). Additional user fees apply to additional requests for Form 6166 under the same TIN or requests for Form 6166 under a different TIN. The user fee must be in the form of a check or money order payable in U.S. dollars to the United States Treasury.

You must send the completed Form 8802, all required statements and documentation and the appropriate user fee to the Internal Revenue Service, P.O. Box 42530, Philadelphia, PA 19101-2530, USA, or by private delivery service to Citibank, Attn: IRS Lockbox Operations, 1617 Brett Road, New Castle, DE 19720-2425. The Certification requests are generally processed within 45 days from the date received. This certification remains valid for three years. Form 8802 and the related instructions can be obtained from the IRS website .