Netherlands: Clarifications, proposed withholding tax on holding cooperative’s profit distributions

Netherlands: Clarifications, proposed withholding tax

The Deputy Minister of Finance on 16 December 2016 addressed questions concerning a proposal for changes to the tax treatment of certain profit distributions. A bill—as of yet presented to the Parliament—would amend the dividend withholding rules, and would make holding cooperatives subject to tax in certain instances.

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Currently, profit distributions by cooperatives are, in principle, not subject to dividend withholding tax. Profit distributions by private limited liability companies (BVs) or public limited companies (NVs) are, in principle, subject to tax. The bill would introduce a dividend withholding tax obligation for holding cooperatives. 

The government’s intention is to hold a public consultation on the draft bill before it is presented to the Lower House, with a proposed effective date of 1 January 2018.

 

Read a December 2016 report prepared by the KPMG member firm in the Netherlands

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