We develop a functional renormalization group (FRG) approach for the two-dimensional XY model by combining the lattice FRG proposed by Machado and Dupuis [Phys. Rev. E 82, 041128 (2010)PLEEE81539-375510.1103/PhysRevE.82.041128] with a duality transformation that explicitly introduces vortices via an integer-valued field. We show that the hierarchy of FRG flow equations for the infinite set of relevant and marginal couplings of the model can be reduced to the well-known Kosterlitz-Thouless renormalization group equations for the renormalized temperature and the vortex fugacity. Within our approach it is straightforward to include weak amplitude as well as out-of-plane fluctuations of the spins, which lead to additional interactions between the vortices that do not spoil the Berezinskii-Kosterlitz-Thouless transition. This demonstrates that previous failures to obtain a line of true fixed points within the FRG are a mathematical artifact of insufficient truncation schemes.
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