COMMERZBANK AKTIENGESELLSCHAFT

creditable against the investor’s personal or corporate income tax liability or refundable, as the case
may be.
Withholding tax
If the Notes are kept or administered in a domestic securities deposit account by a German credit or
financial services institution (or by a German branch of a foreign credit or financial services institution),
or by a German securities trading firm (Wertpapierhandelsunternehmen) or a German securities
trading bank (Wertpapierhandelsbank) (altogether the "Domestic Paying Agent") which pays or
credits the interest, a 25 per cent. withholding tax, plus a 5.5 per cent. solidarity surcharge thereon,
resulting in a total withholding tax charge of 26.375 per cent, is levied on the interest payments. The
applicable withholding tax rate is in excess of the aforementioned rate if church tax is collected for the
individual investor.
Capital gains from disposal or redemption of the Notes
Subject to the tax allowance for investment income described under Interest income above capital
gains from the sale or redemption of the Notes held as private assets are taxed at the 25 per cent. flat
tax (plus a 5.5 per cent. solidarity surcharge thereon and, if applicable to the individual investor,
church tax). The capital gain is generally determined as the difference between the proceeds from the
sale or redemption of the Notes and the acquisition costs. In case of physical delivery of securities
upon redemption or sale the fair market value of the securities delivered will be taken into account in
determining the amount of proceeds received from the sale or redemption. Expenses directly related
to the sale or redemption are taken into account. Otherwise, the deduction of related expenses for tax
purposes is not possible.
Where the Notes are denominated in a currency other than Euro, the acquisition costs and the
proceeds from the sale or redemption are computed in Euro, each at the time of the acquisition, sale
or redemption, respectively.
In case of Notes where the issuer is entitled to physical delivery of shares or securities (Wertpapiere)
the delivery of the shares or securities may depending on the final terms of the Notes not constitute a
taxable event with respect to capital gain or losses built into the Notes at the time of the delivery
provided that (i) the exchange ratio of Notes into shares or securities is fixed and pre-determined and
(ii) the physical delivery of shares or securities is made instead of the cash repayment of the nominal
amount of the Notes at maturity. If the physical delivery qualifies for the tax neutral exchange the
acquisition costs the investor has in the Notes will generally be rolled over into acquisition costs of the
shares or securities delivered. The German tax authorities issued a circular on June 15, 2009
according to which total loss certificates (Vollrisikozertifikate) do not qualify for the tax neutral roll-over.
Total loss certificates within the meaning of the circular are debt instruments which performance are
dependent on an underlying (such as an index or basket of shares) and where the repayment of the
nominal amount as well as any income is contingent on uncertain events.
Capital losses from the Notes held as private assets are tax-recognized irrespective of the holding
period of the Notes. The losses may, however, not be used to offset other income like employment or
business income but may only be offset against investment income subject to certain limitations.
Losses not utilized in one year may be carried forward into subsequent years but may not be carried
back into preceding years.
The flat tax is generally collected by way of withholding (see succeeding paragraph – Withholding tax)
and the tax withheld shall generally satisfy the individual investor’s tax liability with respect to the
Notes. With respect to the return filing investors are referred to the description under Interest income
above.
If the Notes are held as business assets (Betriebsvermögen) by an individual or corporate investor
that is tax resident in Germany, capital gains from the Notes are subject to personal income tax at
graduated rates or corporate income tax (plus solidarity surcharge thereon) and trade tax. The trade
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