1E9Ct5D

Doing business in the Netherlands 153.4 Leasing practises and taxesOffices and industrialTypical lease length Negotiable, but the common practice is 5 years + auto-renewalsfor 5 yearsTypical break options NegotiableFrequency of payment Negotiable, but generally quarterly in advanceAnnual indexLinked to consumer price index(CPI; all households)Rent reviewsTo market prices only if agreed upon (frequency usually 5 years,by expert panel)Service chargeDepending on contractTax (VAT) 21%Tax (others)Property tax, water tax and sewer taxIn all instances:The tenant has security of tenure as the lease automaticallyrenews at expiry, bearing in mind thenotice period. The exception to this is if the landlordwishes to occupy, tear down or redevelop the building.These conditions are rather strict and in realitythe landlord’s options of terminating the lease arelimited.• The tenant pays for internal repairs and utilities.• The tenant is responsible for insurance of contents.• The landlord pays for the external and structuralelements of the building.• The landlord is responsible for building insuranceand non-recoverable service charge items.• The landlord provides property managementservices that are not recoverable through servicecharges.More about taxesThe landlord and the tenant are each partly responsiblefor the property tax levied by the localauthority. Each property is assessed for taxationpurposes, known as “onroerende zaak belasting”(OZB).The local government gives a value for the propertyand that value applies for 1 year. Each yearthe authorities collect the tax. The rate depends onthe local authorities and this is a percentage of thevalue according to the Immovable Property Act.Purchase practises and taxesThe purchaser is responsible for the so-called ‘kosten-koper’,which means that the buyer is liablefor the payment of all additional costs. Those costsinclude transfer tax (6% for offices and industrialbuildings), notary costs (0.2-0.4%), legal costs(negotiable) and some minor administration costs,such as land registration (Kadaster).General building costsOperational Costs 10.0%Maintenance 7.0%Management 1.5%Property taxDepending on the municipalityOthers 1.0%Insurance 0.3%