Lower House queries turnover tax aspects

The Dutch State Secretary for Finance has answered questions tabled in the Lower House on the topic of turnover tax and the associated deadlines and obligations. Turnover tax returns can be filed at monthly, quarterly or annual intervals. Most tax payers file their returns on a quarterly basis, although the Inspector of Taxes may change this to monthly intervals where (s)he has reasons for doing so or the tax payer in question prefers adhering to the shorter reporting period. In some cases the reporting period is extended to the entire year. Turnover tax returns are required to be filed within one month of the end of the period under review, with payment to the Receiver of the corresponding tax charge (as per the tax return) having to be made within one month of the end of the relevant period.

The Inspector of Taxes is required to respond to applications for a tax refund within a reasonable term of no more than eight weeks of the date of the relevant petition having been filed, on pain of the Tax Office being charged with interest on overdue tax for the excess period. The Receiver of Taxes is required to pay out the refundable amount within a six week term of the date of the Tax Office’s underlying decision, and has to pay interest on overdue tax for the excess period where the relevant deadline is missed. The Tax Office customarily pays out the amount of the refund within a week of the date of the underlying decision.

Any business owner who fails to pay turnover tax altogether or whose payments are incomplete and/or tardy is open to receiving an additional tax assessment, with the Tax Office having the right to charge interest on overdue tax where such additional assessment is imposed after the relevant calendar year end. No additional tax assessments will be imposed in connection with supplementary turnover tax returns that are filed within three months of the end of the relevant calendar year.

The default surcharge for non-payment and incomplete and/or tardy payment of outstanding turnover tax can run to 5,278 euros as a maximum, in addition to which a negligence penalty of up to 100 percent of the outstanding amount can be slapped on the business owner in question for (malicious) intent or gross culpability on his or her part. The negligence penalty or default surcharge, as appropriate, is usually levied in combination with the additional assessment. The Tax Office’ time limit for raising the additional tax assessment is capped at five years of the end of the calendar year in which the tax debt first arose. The Administrative Fines (Tax and Customs Administration) Decree contains policy regulations governing the imposition by the Tax Office of default surcharges and negligence penalties.

The supplementary turnover tax return is the requisite tool for rectifying past mistakes or omissions having resulted in too much or too little turnover tax having been paid at any time during the past five years. Discrepancies of less than 1,000 euros in taxes can be straightened out by adjusting the next tax return accordingly. A supplementary tax return may trigger an additional turnover tax assessment being levied, for payment within a fortnight of the date of the date of the assessment. The Tax and Customs Administration will classify negative supplementary returns either as notices of objection or as applications for an ex officio tax rebate (this will depend on the moment of filing).

In the event that the Tax Office selects a particular negative turnover tax return for audit purposes, the tax payer will be sent a questionnaire for completion within the next three weeks, with the Tax Office having a further six weeks to come to a decision as to whether or not further action is warranted (such as performing a fully fledged audit of the business’ accounts or subjecting the business owner to further grilling).

Dutch version: Kamervragen aangifte omzetbelasting