WTS in Netherlands

Major changes to the 30% tax ruling in the Netherlands starting 2024: gradual decrease of tax benefit.

On Budget Day 2023 (19 September 2023), legislative proposals were published for 2024 and onwards that could impact the real estate and the financial services industries.

As of 1 January 2022, companies that qualify as a withholding agent for Dutch wage tax and so-called collective administering organisations are obliged to notify the Dutch tax authorities of payments made to per­sons who are not on the payroll

The Amsterdam Court of Appeal denied the dividend withholding tax exemption for a distribution to a Belgian family holding company due to lack of substance.

On October 24, 2022, the Netherlands published the draft bill on Pillar Two called ‘Minimum Tax Rate Act 2024’ (news item). This draft bill is open for public consultation until December 5, 2022.

The 30% ruling is a specific tax regime for foreign employees who meet certain criteria and who are temporarily assigned to, or hired from abroad by an employer in the Netherlands.

February saw the Supreme Court of the Netherlands rule in a case concerning the conditions for forming a VAT group in the Netherlands.

On 22 December 2021, the European Commission (“EC”) published a proposal for a directive to prevent the abuse of shell entities for improper tax purposes (hereafter: “ATAD3 Directive”).

Effective 1 January 2022, the Netherlands have implemented a ground-breaking legislation to end its long-standing practice of allowing unilateral downward TP adjustments.

The Dutch government intends to introduce measures to (better) curb dividend stripping with respect to portfolio shares.

The State Secretary’s Decree of 22 March 2019 (No. 2019-42405) describes the circumstances under which it may be assumed that the collective investment fund in question is under ‘special government supervision’.

On 3 September 2021, the Appeals Court at ‘s-Hertogenbosch ruled in a case of a German real estate investment fund in contractual legal form (Immobilien-Sondervermoegen) – ‘the Fund’, with respect to its foreign tax payer status for its income from Dutch real estate in the years 1997/1998 until 2009/2010.

The Dutch Ministry of Finance kicked off an internet consultation on a draft proposal (the “Draft Bill”) to amend the Dutch codification of the arm’s-length principle. Group companies operating in the Netherlands are recommended to review their existing advance pricing agreements and/or tax rulings as well as their transfer pricing policies to assess the impact of this proposed amendment of the arm’s-length principle.

In the Netherlands, the Dutch Ministry of Finance has published a draft proposal under which downward adjustments would be limited in order to address transfer pricing mismatches when applying the arm’s-length principle.

Our summary of R&D Incentives provides guidance where such incentives are provided, and who in WTS Global can support you to gain from these incentives for your business or individually the most.

On 9 April 2021, the Dutch Supreme Court ruled in a landmark case that will decide all pending cases where foreign investment funds claim the refund of Dutch dividend WHT suffered in years starting from 2008.

The finance ministers of the Group of Seven (G7) have agreed on a historic global tax deal on 5 June 2021. Read more in the latest newsflash by Atlas Tax Lawyers.

Our colleague Denis Pouw provides insight on the most interesting developments of 2020 regarding the Dutch "dividend tax" on portfolio dividends received from foreign investment funds.

Dutch authorities concluded an agreement with the Belgian and German authorities to mitigate the tax and social security
impact from working from home.

In an example, our colleagues from the Netherlands describe the field of tension in which the OECD regulations and Dutch tax laws on the deductibility of intra-company financing are currently moving.

As per 1 March 2020, service providers from the European Economic Area and Switzerland need to register new temporary assignments in the Netherlands ultimately 5 days before the start of employment online. 

The European Commission (EC) concluded an APA

Overview of the resulted transitional law

OECD Released Workplan

It is recommended to investigate the status of (possibly) existing permanent establishments in the light of the expected changes

Three members of the Dutch House of Representatives jointly prepared a legislative proposal that should limit the current liquidation loss scheme and the related cessation loss scheme

After consultation with the maritime sector, the changes were postponed until 1 January 2019

Summary of the VAT relevant topics

On Budget Day (18 September 2018), the Dutch government published the new tax measures for 2019 and beyond

Budget Day: Dutch government released its proposal to abolish the  dividend withholding tax of 15% as of 2020

The most important measures are the earnings stripping rules that limit the deductibility of interest and measures for controlled foreign companies (”CFC”)

Amendments aim to provide an equal treatment of domestic and cross-border EU situations for certain tax provisions

Report follows the final report on ‘Preventing the Artificial Avoidance of Permanent Establishments Status’

Amendment of Directive on Administrative Cooperation (“DAC”) 

Roadmap and attention points for the taxation of corporates in the future

 In its judgement, the CJEU followed the conclusions of the Advocate General (AG) of 25 October 2017

Decision could have a major impact on the applicability of anti-abuse provisions and substance requirements for holding companies within the EU, including the Netherlands

Public comments are invited on the discussion draft and should be submitted by September 7, 2018