No link between spouses wage and director shareholders wage
According to the Supreme Court of the Netherlands, the determination of a director shareholder’s “customary wage” does not involve allowances having to be made for said director shareholder’s spouse’s wages. A director shareholder is required at the very least to collect a customary wage for the work he or she performs on behalf of the (private) company he or she owns, “customary” being defined as what employees in similar positions lacking a substantial interest in their employer would earn, the standard amount for 2014 having been fixed at EUR 44,000 per annum.
Having audited the accounts of a particular (private) company, the Inspector of Taxes took the view that the remuneration of the sole shareholder in the company in question had to be fixed at the standard amount for a series of years. As the director shareholder’s actual wage had been lower, the Inspector slapped several additional tax assessments upon the company. This sparked a lawsuit revolving around the question as to whether the Inspector’s determination of the customary wage had been accurate. The Hague Court of Appeal ended up quashing the additional tax assessments, its motivation being that the remuneration for the director shareholder and the latter’s spouse had been in agreement with the amount of work the two had performed. The Supreme Court in turn set aside the Court of Appeal’s ruling, arguing that the Court of Appeal in making allowances for the spouse’s wage when assessing the customariness of the director shareholder’s wage had failed to confine itself to the actual dispute: the customariness of the director shareholder’s wages were nothing to do with the wage having been paid out to the director’s wife.