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

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person or entity has paid a consideration (in the broadest sense) within the framework of a combination of transactions where it may be assumed that: a) all or part of the dividend distributions has been made, directly or indirectly (for instance, due to the payment of the consideration), for the benefit of: � an individual or legal entity with respect to whom or which no exemption may be granted from the withholding obligation, whereas such exemption may be granted to the party paying the consideration; or � an individual or legal entity (again, usually the original shareholder) whose entitlement to a reduction or refund of dividend tax is lower than that of the party paying the consideration; and b) the individual or legal entity directly or indirectly retains or acquires a position in stock, profit-sharing certificates, or profit-sharing bonds that is similar to its position in such stock, profit-sharing certificates, or profit-sharing bonds before the commencement date of the combination of transactions referred to above. Certain factors reduce the chance of a dividend stripping situation arising, such as the period between the moment of the transfer and the dividend distribution, the character of the dividend (regular, incidental, or liquidation distribution) and the duration of the transfer. The burden of proof lies with the Dutch tax authorities. In the event of a dividend stripping transaction, the Dutch company has to withhold 15% withholding tax on its dividend distribution. If the conditions for dividend stripping have been established, no reduction of the 15% withholding tax would be provided even if the deemed economic owner would have been entitled to a certain credit, reduction, or refund (e.g., 10% instead of 15%). 184 Baker & McKenzie
18.9 Tax Incentives Doing Business in the Netherlands 2012 The following measures provide tax relief to taxpayers: 18.9.1 Investment Allowance The investment allowance (investeringsaftrek) is limited to small investments (EUR2,200 to EUR300,000) and comprises a deduction of a percentage at a maximum of 28%. Investment Percentage EUR0 - EUR2,200 0% EUR2,200 - EUR54,324 28% EUR54,324 - EUR100,600 28% with a maximum of EUR15,211 EUR100,600 - EUR301,800 EUR15,211 less 7.56% of the amount which exceeds EUR 100,600 EUR301,800 and more 0% In addition, an investment allowance of 41.5% is available for energysaving investments (EUR2,200 to EUR116,000,000). Furthermore, an investment allowance of 35%, 50%, or 60% is available for certain qualified environment investments (exceeding EUR2,200, but not if an energy investment has already been applied for). If within five years after the beginning of the calendar year in which the investment took place more than EUR2,200 in assets for which an investment allowance was claimed is disposed of, a proportionate percentage would be added to the company’s profit (divestment addition or desinvesteringsbijtelling). Withdrawal from an asset is deemed a disposal in this respect. Assets that are used for the operation of a business that is subject to a regulation to prevent international double taxation are excluded from the investment allowance. However, an exception could be made by the Dutch Minister of Financial Affairs. Baker & McKenzie 185
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Editorial Contributions Robert van
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Innovative ways to inform you Doing
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1 The Netherlands Doing Business in
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Steady-Course Policy Doing Business
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2 Legal Forms of Doing Business Doi
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2.3 Branch versus Subsidiary Doing
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4 The Subsidiary 4.1 Incorporation
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8 Commercial Contracts 8.1 General
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9 Real Estate 9.1 Ownership Doing B
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9.7 Leases Doing Business in the Ne
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10.5 The European Economic Area Doi
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12 Telecommunications 12.1 Market S
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12.9 Net Neutrality Doing Business
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14 Labor Law 14.1 Term Doing Busine
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14.4 Works Council Doing Business i
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23.3.3 Product Liability Doing Busi
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24.13 Arbitration Doing Business in
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Tax Corporate & International Tax H
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