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Measures List
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Measure Name
Date when measure came into force
Reduction of CIT-rate, prolongation of low rate 2011/01/01
Various measures in CIT 2012/01/01
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Generic Tax Name Corporate income tax
Tax name in the national language Vennootschapsbelasting
Tax name in English Corporation tax
Member State NL-Netherlands
Tax in force since 1969/01/01
If abolished, date on which the tax ceases to apply
Business version date 2015/01/01
Version date 2015/02/17
This file was last updated on

Type of tax
Direct taxes Personal income tax
Corporate income tax
Other

Indirect taxes VAT
Excise duty (EU harmonised)
Alcoholic beverages
Energy products and electricity
Manufactured tobacco
Other

Social security contribution Employers
Employees
Other
 
Legal base

Corporation Tax Law 1969 (Stb. 445).

 
Who sets
The tax rate is set by




The tax base is set by




The reliefs are set by




Comments
 
Beneficiary





Comments

 
Geographical Scope
 
Taxpayers
Domestic-source income of non-resident entities is Taxed
Not Taxed
Comments

Taxpayers are public (NV) and private (BV) limited companies, and other legal persons if they carry on the business of an enterprise in the Netherlands.

 
Tax object and basis of assessment
As general rule, taxable income under corporate income tax includes also








Comments

Income considered Domestic income
Worldwide income (subject to double-tax relief)
Comments

Comments

A company may build up certain reserves by making a deduction from its profits. Examples of permitted reserves are the cost equalization reserve and the roll forward facility.

From 2013, the rules on Thin Capitalization have been abolished. They have been replaced by a limitation of the deductibility of interest on loans used to finance participations.

 
Deductions, Allowances, Credits, Exemptions
Valuation of inventory
System First-in first-out (FIFO)
Last-in first-out (LIFO)
Average cost
Specific identification (unit method)

Comments

Depreciation rules
 
Buildings
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments

Depreciation rate: 0-3%.

The depreciation base comprises all costs necessary for the acquisition of a building, for example notary costs, commissions, real estate transfer tax, directly related subsidies and buy out premiums, but excluding deductible VAT. Also costs incurred to make the building operational must be added to the book value of the building and thus form part of the depreciation basis, irrespective of whether these costs are incurred to maintain or improve the building. All parts of a building, the land on which it is founded and appurtenances as seen as part of the building and increase the book value of the building (Article 3.30a(2) PITA). Subsequent costs for maintenance need not to be added to the book value, but can be deducted. Improvement costs, on the other hand, need to be added to the book value (BNB 1980/231).

The depreciation period needs to be set on the basis of the technical lifetime of the building or, alternatively, on the economic lifetime of the building, whichever is the lowest. Generally speaking, sound business practice requires an ordinary tax depreciation method at constant rates in the range of 0 per cent – 3 per cent per annum. Degressive depreciation is only allowed under limited circumstances (BNB 1966/68).

Depreciation is no longer allowed if the bookvalue of a building is i) lower than 100 per cent the so-called WOZ-value (which value tends to equate the fair market value) in the case building is held as an investment, or ii) lower than 50 per cent of the WOZ-value in where the building is used within the enterprise. In other cases, buildings cannot be depreciated below their estimated residual value. In general terms, one can say on the basis of the above that buildings are depreciated in a straight line during the useful life of the building to their estimated residual value, and that depreciation is stopped when (50% of) the WOZ-value is reached.

Average depreciation period
Average depreciation rate
 
Movable (tangible) assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments

Depreciation rate: 0-20%.

Depreciation of short-life machinery and equipment must be determined on a stand-alone basis on the basis of sound business practice. The depreciation period needs to be set on the basis of the technical lifetime of the asset or, alternatively, on the economic lifetime of the asset, whichever is the lowest. The depreciation base is constituted by the acquisition or development costs (Article 3.30(1) PITA). The annual depreciation is limited up to 20 per cent of the book value of the asset (Article 3.30(2) PITA).

Degressive depreciation is allowed in circumstances where the yielding of an asset is initially higher, but decreases in later years.  Progressive depreciation is allowed, but not required, under the reverse circumstances; linear depreciation is also allowed in such case (BNB 2007/302). For certain assets (e.g. energy saving assets) depreciation at random is allowed (Article 3.31 and Article 3.34 PITA).

The depreciation base comprises all costs necessary for the acquisition of the asset, for example transport costs, financing costs and directly related subsidies, but excluding deductible VAT. Also costs incurred to make the asset operational must be added to the book value and thus form part of the depreciation basis, irrespective of whether these costs are incurred to maintain or improve the asset.

Fixed tangible assets not subject to wear and tear and obsolescence shall not be subject to depreciation.

Costs for low-value assets may be expensed immediately (Article 3.30(4) PITA). Whether or not an asset qualifies as a low-value asset needs to be determined on the basis of circumstances, such as the nature and cost price of the asset, and the size of the enterprise. Assets with a cost price of less than € 450 are regarded to qualify as low-value assets based on Netherlands tax policy.

Average depreciation period
Average depreciation rate
 
Movable fixed assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments

Depreciation rate: 0-20%.

Dutch tax law does not fundamentally distinguish between short-life and long-life machinery and equipment. Therefore, the answers provided in the previous corresponding sections are mutatis mutandis valid here.

Average depreciation period
Average depreciation rate
 
Intangible assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments

Depreciation rate: 0-20%.

Internally generated intangibles are deductible immediately and need not to be capitalized (Article 3.30(3) PITA). Self-developed goodwill cannot be capitalized and can therefore not be depreciated.

In other cases, only intangibles that have been acquired against a lump-sum can be capitalized. The depreciation base is determined by the acquisition price, including costs directly connected with the acquisition (see also Article 3.30(1) PITA). The annual depreciation is limited up to 10 per cent of the book value of the asset in the case of goodwill and 20 per cent of the book value in case of all other intangible assets (Article 3.30(2) PITA).

As a general rule, sound business practice (in conjunction with Article 3.30(2) PITA) requires an ordinary tax depreciation method at constant rates in the range of 0 per cent – 10 per cent per annum in the case of goodwill, and 0 per cent – 20 per cent per annum in the case of all other intangible assets, depending on the intangible involved. Depreciation against progressive rates (patents and copyrights) or degressive rates (trademarks) is also possible, depending on the type of intangible involved.

Average depreciation period
Average depreciation rate
 
Land (if any)
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate


Comments

Taxpayers are free to choose any depreciation method, but the method chosen must be in line with sound business practice. However, most companies use the straight-line method. Special rules are applicable for certain assets, for example buildings and purchased goodwill, where depreciation is permitted until a certain maximum. Investments in the year 2009 can be written off in two years, excluding certain assets, e.g. buildings.


Are there limits to interest deductions? Yes No
If yes:
Definition of deduction limit

Comments

Special anti-abuse rules apply to interest on non-functional loans paid to a related company. Interest paid on these loans is not deductible. Non-functional loans are loans related to certain transactions;

  • distribution of profits or return of paid-up capital
  • capital contribution
  • purchase of shares in a company which is to become a related company

 

From the first of January, 2012, deduction of interest after takeovers is limited in case the acquiring company forms a fiscal unity with the target company. The deduction of interest is then limited to the amount of profits of the acquiring company.

From 2013 the Thin Capitalization rules have been replaced by a set of rules on interest paid on loans, considered to finance participations. As far as these interest payments exceed EUR 750,000, they cannot be deducted from taxable profits.


Is there an Allowance for Corporate Equity? Yes No
If yes:
Notional rate applied for allowance

Comments

Losses
Loss carry-forward exists? Yes No
If yes:
Time limit: Indefinite
9  Years  
Size limit:
 
Loss carry-backward exists? Yes No
If yes:
Time limit: Indefinite
1  Years  
Size limit:
 

Comments

Losses may be set off against profits earned in the preceding year and the following nine calendar years.

Losses of a holding company may not be offset against operating income. Such losses may only be set off against later profits of years in which the company activities still consist of at least 90% group financing or of holding participations.



Comments

Exemptions

The Corporate Income Tax Act provides for a participation exemption, which is applicable - under certain conditions - to both domestic and foreign shareholdings. A participation is regarded to exist if the taxpayer holds at least 5% of the nominal paid-up capital of a company of which the capital is partially or wholly divided into shares.

All benefits gained from shareholdings are exempt under the participation exemption, in order to avoid economic double taxation when the profits of a subsidiary are distributed to its parent company. The term 'benefits' covers dividends received, value increase as well as value decrease of the shares and capital gains and losses. Losses arising from liquidation of the company in which the taxpayer holds a share, may be set off under certain conditions.

Reliefs

Investment: Investing in assets up to EUR 309,693 p.a. (KIA), assets that are considered environmental friendly (MIA) and in assets for an efficient use of energy (EIA). The relevant rules for the corporation tax are largely corresponding to those for the Personal Income Tax Law.

60% of capital costs and current expenses for R&D can be deducted from profits (R&D Deduction)

 
Rate(s) Structure
Nominal corporate income tax rate Rate: 25.00 %

Central government surcharge Rate:
Regional government surcharge Rate:
Local government surcharge Rate:
Combined rate (all-in rate) Rate: 25.00 %


Comments

Rate structure:

Rate 1: 20%  applying from 0.00 EUR

Rate 2: 25% applying from 200,000.00 EUR


Special tax rate for SMEs
Special tax rates apply to SMEs: Yes No
If yes:
Nominal corporate income tax rate Rate: 20.00 %
Central government surcharge Rate:
Regional government surcharge Rate:
Local government surcharge Rate:
Combined rate (all-in rate) Rate: 20.00 %


Comments

The reduced rate of 20% applies to the first EUR 200,000 profits of all companies, including large companies.

 
International aspects
Treaty countries Non-treaty countries
 
Repatriated profits are taxed according to the following system Exemption system Exemption system
Tax credit Tax credit
Deduction Deduction
 
Interest received is taxed Yes No Yes No
Tax rate on interest received 25.00 % 25.00 %
Outgoing dividends withholding tax 15.00 % 15.00 %
Outgoing interest payments withholding tax 0.00 % 0.00 %
 
Foreign losses can be set-off Yes No Yes No
If yes:
Minimum direct or indirect shareholding to qualify loss-offset (if applicable)
 
Loss carry-forward exists? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Loss carry-backward exists? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Controlled foreign company (CFC-)rules exist? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Threshold for capital or voting power held directly or indirectly by resident in non-resident company
CFC-rules apply if foreign tax rate is lower than
CFC-rules apply for passive income only? Yes No Yes No

Comments   Treaty countries

Outgoing dividends to non-treaty countries are subject to dividend tax at a rate of 15%. For treaty countries the rate differs from 0% to 15%, dependent on the requirements of the specific treaty.

Until 1 January, 2012, profits and losses from foreign permanent establishments were taken into account for Dutch CIT. This facility has been abolished on 1 january, 2012.


Comments   Non-treaty countries

see comments Treaty countries

 
Measures against profit shifting
 
Do Thin Capitalization (TC) rules exist? Yes No
If yes:
Date of first introduction
Introduced as Explicit TC law
Part of CIT law
Test for TC Ratio
Arm's length
If ratio
Value of numerical ratio:
Definition numerator
Definition denominator
 
Debt considered for test Internal
Internal and external
TC depends on shareholding? Yes No
Substantial shareholding threshold
 
Type of shareholding Direct
Indirect
Automatic remedy Yes No
Remedy Non-deductibility of interest
Reclassification as dividend
 
Rules apply to All companies
Foreign companies
Non-EU companies
Transfer pricing rules exists? Yes No
If yes:
Arm’s length principle applied? Yes No
 
Remedy Fee
Tax base increase
 
Tax due date

Taxpayers are required to file an annual corporate income tax return with the tax administration within six months of the end of its financial year. On request the tax inspector may extend this term. The return must be accompanied by all the information needed to establish the company's taxable profits. This includes the balance sheet, profit and loss account and any other information requested by the Inspector.

If a full return is not filed, the Inspector may issue an estimated assessment. The final assessment must be issued no later than three years after the end of the relevant tax year.

If a postponement has been granted for filing the return, the period will be extended by the period of the postponement. The accounting records must be retained for at least 7 years.

Entrepreneurs are obliged to file annual corporate income tax returns and income tax returns electronically.

 
Tax collector

The tax collector is the central tax administration.

 
Special features

Special features

  • Fiscal unity: Under certain conditions a parent company and one or more subsidiaries may be taxed as one taxpayer. For corporate income tax purposes this means that the balance sheets of the parent company and the subsidiaries are consolidated into one balance sheet for taxation and the tax is levied at the level of the parent company. The main advantages of group taxation are that the losses of one company can be set off against profits from another group company, and that fixed assets may be transferred tax-free from one company to another. Group taxation is only allowed if the parent company holds at least 95% of the shares in the subsidiary. Group taxation may be terminated on request, or will be terminated automatically when any of the conditions are no longer met.
  • Regime for investment funds: provided that all current income is distributed to shareholders and a number of other conditions are met, an investment company or fund is taxed at a rate of nil per cent on the profit.
 
Economic function







Comments

 
Environmental taxes



Comments
 
Tax revenue
ESA95 code d51oa (d51ba)

Year
Annual tax revenue (millions)
Currency
Tax revenue as % of GDP
Tax revenue as % of total tax revenue
2012 11,854.00 EUR 1.84
2011 12,409.00 EUR 1.93
2010 12,782.00 EUR 2.02
2009 11,604.00 EUR 1.88
2008 18,814.00 EUR 2.94
2007 18,552.00 EUR 3.02
2006 17,907.00 EUR 3.09
2005 17,069.00 EUR 3.13
2004 14,994.00 EUR 2.86
2003 13,392.00 EUR 2.64
2002 15,394.00 EUR 3.11
2001 17,580.00 EUR 3.69
2000 16,736.00 EUR 3.73

Comments