Mandatory annual reporting to the Register of Beneficial Owners
All legal entities subject to mandatory reporting have an obligation to determine the identity of their beneficial owners and to take appropriate steps to verify their identity. Such legal entities must carry out this verification at least once a year and check whether the beneficial owner data in the register is up-to-date.
Obligation to report
In addition to the obligation to verify data, legal entities that are not exempt are required to send a report to the register annually. The report – amending data or confirming previous reports – must be submitted within four weeks of the deadline for the annual verification. This means legal entities have 12 months and four weeks to submit the mandatory annual report.
In addition, ongoing reporting obligations remain in effect – e.g. in the case of formation of a new company, or changes in beneficial owners during the year. Such reports must be submitted within four weeks of becoming aware of the change.
Reminders sent by tax authority
If an annual report is not submitted within the permitted time, the tax authority sends a reminder letter drawing attention to the obligation to report and extending the deadline by six weeks, and stating that failure to report within this grace period will result in a fine. Penalties of up to EUR 200,000 may be imposed.
General partnerships (OG) and limited partnerships (KG) are exempt from reporting beneficial ownership, if all personally liable shareholders are natural persons. Limited liability companies (GmbH) are exempt if all shareholders are natural persons (data are extracted from the register of companies). Sole proprietorships, industrial cooperative societies, and non-profit associations are also exempt.
Submitting reports
Legal entities subject to the reporting requirement have an obligation to submit the reports themselves. However, it is also permitted for professional representatives (e.g. tax advisors or auditors) to determine and verify beneficial owners on behalf of their clients, and to report them to the register.
We would be happy to carry out verification and reporting of beneficial owners for you.