A special purpose vehicle (SPV) established by TSI Services GmbH was subjected to an extensive external tax audit in the period from November 2022 to September 2023. The SPV was set up for a securitization transaction of a German originator – consumer loans were securitized as part of the revolving structure.
The scope of the audit by the responsible tax office in Frankfurt covered the areas of corporation tax, VAT and trade tax for three consecutive financial years. As part of the audit, the entire transaction documentation, the underlying portfolio and the associated cash flows (including value adjustments) as well as the refinancing via the issue of notes were examined.
The tax audit came to the overall conclusion “that no findings were made that would lead to a change in the tax bases (Section 202 (1) sentence 3 of the German Fiscal Code).”
Since 2004, 170 SPVs have already been established via TSI Services GmbH. During this period, a total of two SPVs were audited for tax purposes and in both cases no audit findings were addressed by the tax office.
Summary
It can be stated that German SPVs established via TSI Services GmbH offer many advantages. The standard of provision is well known to all major rating agencies, large law firms, auditing companies, supervisory authorities, the European Central Bank (ECB) and numerous domestic and foreign originators and arrangers, and the processes have been tried and tested many times over. The current tax audit has fully confirmed the reliability of German SPVs.
Further information
on the German SPV and the underlying securitisation platform as well as on the process of providing and liquidating SPVs can be found on TSI’s new website.