Accountancy in The Netherlands

>> Withholding Taxes in The Netherlands

Interest

The Netherlands does not deduct withholding taxes from interest. As a result of international legislation related to tax evasion, the Dutch government will introduce a source tax on outgoing financial flows to low tax jurisdictions in 2020. Interest will, therefore, be taxed in the Netherlands in case of payments to a country designated as a low tax jurisdiction. How and to what extent is currently not clear yet.

Royalties

Royalties are currently not taxed in the Netherlands. As a result of international legislation related to tax evasion, the Dutch government will introduce a source tax on outgoing financial flows to low tax jurisdictions in 2020. Royalties will, therefore, be taxed in the Netherlands in case of payments to a country designated as a low tax jurisdiction. How and to what extent is currently not clear yet.

Dividend payments

The Netherlands levies a 15% withholding tax on dividends paid. In domestic situations, the dividend tax is a recoverable 25% withholding income tax.

If dividends are paid out to foreign shareholders, the relevant double taxation treaty may limit the percentage of the Dutch dividend tax to 10%, 5%, or nil.

European legislation, such as the Parent Subsidiary Directive, may also limit the dividend tax to nil.

Deducted and paid dividend tax may be refunded in certain situations.

Dividends entering the Netherlands qualify for the participation exemption and are not subject to taxation. However, there may be exceptions to the rule.

At this moment there are government plans to abolish the withholding tax on dividends paid in 2020. Only a source tax on dividends paid to low tax jurisdictions will remain.


Latest version updated 12th February 2018

Country Breakdown

17.02

Million

Population

Euro

Currency

$ 770.8

Billion

GDP

41,543

km2