Doing Business in the Netherlands 2012 - American Chamber of ...

17 Personal Income Tax
17.1 General
In the Netherlands, private individuals are subject to personal income
tax. In general, every individual who lives in the Netherlands (i.e., a
resident) is subject to taxation on his or her worldwide income. An
individual who does not live in the Netherlands (i.e., a non-resident) is
subject to taxation only on certain income from a Dutch source, as
stipulated by law. Examples include income obtained from a Dutch
business operated by a branch in the Netherlands, income obtained
from Dutch real estate, directors’ fees, income from employment in
the Netherlands and benefits from a substantial interest (aanmerkelijk
belang) in a company located in the Netherlands.
However, a non-resident may opt to be treated as a resident taxpayer
for personal income tax purposes, provided that the individual is a
resident of the EU or of a country that has signed a double taxation
treaty with the Netherlands containing a provision on the exchange of
information. Please note that some articles are excluded by law for
non-residents who have obtained a resident status. Dutch tax
authorities (Belastingdienst) may wish to tax recipients of Dutch
source income, but whether Dutch tax authorities may actually do so
depends on the provisions set out in a tax treaty for the avoidance of
double taxation in many cases. A tax treaty will be applicable only if
the recipient of Dutch source income is a resident of one of the treaty
countries.
17.2 2001 Personal Income Tax Act
The 2001 Personal Income Tax Act distinguishes three types of
income that are subject to personal income tax and classifies them
under “Box I,” “Box II,” and “Box III.”
� Box I income includes profits, employment income, income
from other activities and income deemed to have been
generated from residential home ownership.
152 Baker & McKenzie